Grand Committee
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Enterprise and Regulatory Reform Bill
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“Letting agents etc.
(1) In section 1 of the Estate Agents Act 1979 (estate agency work), for “to which this Act applies” substitute “and in subsection (1A) below to which this Act applies.
(1A) This Act also applies, subject to subsections (2) to (4) below, to—
(a) things done by any person in the course of a business (including a business in which he is employed) pursuant to instructions received from another person (in this section referred to as “the client”) who wishes to let or have the letting of an interest in land managed (for example, the collection of rents on his behalf)—(i) for the purpose of, or with a view to, effecting the introduction to the client of a third person who wishes to let an interest in land; or(ii) after such introduction has been effected in the course of that business, for the purpose of securing the letting of the interest in land; or(iii) for the purpose of, or with a view to, managing the letting of the interest in land on behalf of the client; or(iv) for the purpose of, or with a view to, block management of interests in land; and(b) management activities undertaken by any person in the course of a business (including a business in which he is employed) in connection with land or interests in land.””
Baroness Hayter of Kentish Town
My Lords, this is unfinished business for me. As the then chair of the Property Standards Board, I failed miserably to persuade the previous Government to do what I am now asking, but I feel I might have more success with this one.
The purpose of these amendments is, first, to bring letting agents into the Estate Agents Act, thus enabling the OFT to ban agents who act improperly; and, secondly, to require all letting and block management agencies to join an ombudsman’s scheme, which would give tenants and landlords the possibility of redress. This is already the case for estate agents under the Consumers, Estate Agents and Redress Act 2007 and we simply want to extend this to letting agents, as was demanded by Mark Prisk in 2007. I will make the case in three ways: first, the evidence of need due to the size of this sector; secondly, the number of complaints; and thirdly, the industry’s support for this move.
First, the numbers: about 3.5 million people rent privately, two-thirds of whom go through letting agents. Over 1 million landlords use letting agents to manage their properties. The private rented sector accounts for about 17% of all stock at the moment; this is forecast to rise to 20% by the time of the next general election. Which? estimates that tenants pay £175 million a year in agency fees. So it is a big industry, affecting the most basic of consumer goods—that is, homes—but it is not well run or well regulated.
Indeed, the industry is actually completely unregulated. There is ample evidence of rogue agents in this field. Luckily, there is also lots of evidence of good agents. In fact, just as estate agents have to sign up to a redress scheme, so 60% of letting agents—those who are members of the professional association ARLA: the Association of Residential Letting Agents—choose to belong to a redress scheme. However, 40% of letting agents are not members of a redress scheme because membership is voluntary.
We want all letting and managing agents to be members of a scheme and thus covered by a code of conduct or by the RICS “Blue Book” of standards. The amendment is supported by the two residential property ombudsmen: Ombudsman Services and the Property Ombudsman. The latter, Chris Hamer, has noted that with 40% of agents outside a redress scheme, there is a,
“significant risk for consumers who use such … firms. That risk arises from a failure of the firm to follow accepted standards of operation and customer service as laid down in … [the] code; and … exposes the landlord or tenant to … financial loss either through there being no protection of client money if the firm fails, or because … funds have been misappropriated”.
The Property Ombudsman’s workload with letting agencies has increased 200% in the past five years—up 25% last year alone. Some of that represents the increase in agents who are joining voluntarily, but it is the economic situation forcing more people into the private rented sector that is leading to more complaints. However, a quarter of the complaints referred to the Property Ombudsman could not be handled because the letting agent was not a member of the redress scheme.
The other ombudsman, Lewis Shand Smith, who is chief ombudsman at Ombudsman Services, has stated:
“Protection for the consumer in the lettings market is patchy which in turn leads to confusion. There is also an inequality in that those buying and selling residential properties are protected and have access to redress, while those renting in the private sector do not. A more robust and comprehensive regulatory framework and comprehensive access to independent redress will both protect and empower those in the PRS [private rented sector] market”.
These ombudsmen are seeing the problem grow day by day. Research undertaken by Which? and by RICS bears this out. One in five tenants and 17% of landlords said they were dissatisfied with their letting agents. Indeed, landlords’ customer satisfaction score for letting agents was sixth from the bottom across 50 markets and tenants’ satisfaction was second from the bottom. Half of consumers were unaware of or could not remember if their agent was a member of a professional body and the vast majority of them believed that letting agents are required to abide by a code of practice, despite that not being the case. However, nine out of 10 believe it should be compulsory for agents to register with a regulatory body and meet a code of conduct.
It is not just tenants. Landlords are hardly more sophisticated consumers than tenants. In fact, only one-third checked whether their letting agent was a member of a professional body. So tenants are not in a position to choose the agent and landlords often make bad choices. It is not simply that tenants and landlords have nowhere to go with complaints if there is not a redress scheme. It is also that, because letting agents do not have to be a member of a redress scheme, they cannot be banned for bad practice, they do not have to provide indemnity insurance, they do not need a published complaints procedure, there are no client protection rules and there are no entry requirements or qualifications. It will come as no surprise to the Committee that Shelter, Crisis and Which? support these amendments, as does Boris Johnson, mayor in this city, and Sir Robin Wales, Mayor of Newham, whose borough has driven the debate on regulation of the private rented sector. The noble Lord, Lord Borrie, who is, unfortunately, unwell today and unable to be with us, is also very supportive of these amendments. He was the first director of the OFT, which would gain some powers under one of these amendments. The noble Baroness, Lady Greengross, who sat through our last session when we did not reach these amendments would also like her name associated with them.
We know that those who represent tenants and landlords want this change, but what of the industry? The industry is absolutely behind this amendment. Lucy Morton, who has been described by the Telegraph as,
“the queen of London’s rental market for 30 years”,
told that paper:
“It is shocking that so many letting agents remain unregulated”.
The Chartered Institute of Housing wrote to me that it,
“believes that the private rented sector deserves adequate … regulation … to protect the increasing numbers of people … in the sector ... Currently, the regulatory arrangements … fall short of customer expectations with … nearly 40% of … agents not part of … [the] regime. CIH supports these amendments … [which] would … offer a redress scheme and extend the Estate Agents Act … to include … letting and managing”,
agencies.
They are not alone: the Residential Landlords Association, the British Property Federation, the Royal Institution of Chartered Surveyors, the Federation of Private Residents’ Associations, the National Federation of Property Professionals, the Association of Residential Letting Agents, the National Association of Estate Agents, Southern Landlords Association, the Institute of Residential Property Management and the Association of Residential Managing Agents have all asked me to let the Committee know that they support these amendments and that they support mandatory membership of a redress scheme in line with estate agents. They have written that they,
“believe that the regulatory framework in the lettings market … offers limited protection for the consumer with approximately 40% of lettings agents outside of regulation … The current … framework … costs business money, hitting many micro-businesses and sole practitioners … particularly hard. This amendment will provide consumers with clarity and … protection … raising standards across the rental sector, without adding unnecessarily to business costs”.
One of the UK’s largest estate agents, Knight Frank, has also written to endorse this statement.
This is a king-sized roll call. The industry is completely signed up to the initiative. Indeed, it is one that it has long wanted, as have others such as the Resolution Foundation, which wants all letting agents to be members of an ombudsman scheme and brought under the Estate Agents Act 1979 so that the OFT can ban those that act improperly. There is a major mischief at the moment as an estate agent banned by the OFT can open up the very next day as a letting agent. Charities, campaigners and the industry support my amendments.
I turn now to the governing parties. In their policy document, Decent Homes for All, the Liberal Democrats, noting that the numbers in the private rented sector now equal those in social housing and are set to overtake the public sector by 2020, describe how,
“a minority of bad … letting agents are a blight on the [private rented] sector … bringing PRS into disrepute”.
The Liberal Democrats therefore support,
“regulation … to ensure that … people are protected from unscrupulous or incompetent landlords and managing agents”,
by promising to,
“require all letting/managing agents to be on a national register and … to set up a mechanism whereby bad agents may be removed and therefore prevented from practising”.
These amendments provide that mechanism.
I turn to the other part of the coalition. The then opposition MP and now Housing Minister, Mark Prisk, tabled amendments to the 2007 Consumers, Estate Agents and Redress Bill when it was going through the House. His amendments, as I am sure the Minister has recognised, were virtually identical to my Amendment 28ZH. That is because he said that that amendment would amend the Estate Agents Act 1979 to extend the definition of estate agency work to include residential lettings and management. Some of the scandals in this market include charging both the landlord and the tenant for the same service, charging for simple procedures already covered by a landlord’s management fee, and charging exorbitant fees for basic functions. He went on to say:
“As a Conservative, I am instinctively cautious about arguing for more regulation. However, as a chartered surveyor and a constituency Member of Parliament, I know that we need to put lettings on the same regulatory footing as sales. The fact that the National Association of Estate Agents, the Royal Institution of Chartered Surveyors and the rest of the industry agree shows that the measure is long overdue”.—[Official Report, Commons, Consumers, Estate Agents and Redress Bill Committee, 24/4/07; col. 192.]
I have to confess that my party then proceeded to defeat his amendment. However, with this amendment, we have a chance to implement the amendment tabled by Mr Prisk in the other place. I beg to move.
Baroness Gardner of Parkes
My Lords, I support the amendment, but I do not think it goes far enough. I shall go on to talk about that in a minute. The noble Baroness has raised some interesting points and I was rather cheered to hear about her lack of success with the Labour Government because I am finding the same at the moment with the Conservative Government as regards the regulation of managing agents. I should say at the outset that that is what I think is missing here, and I hope to bring forward an amendment on Report to cover the regulation of managing agents of leasehold properties.
The noble Baroness mentioned the private rented sector. I am aware of what that is, but unfortunately we still seem to be unable to deal with the invisible private sector, which is quite worrying. I meet people all the time who are being forced out of a bedsit or something because the rent is being put up. The landlord does not even declare that he has any tenants—much less use any letting agents—and when the tenants try to find another place to go to, just a simple room, they are joining a huge queue of people. The rent is increasing even as they wait for their opportunity to get a room.
Baroness Howe of Idlicote
My Lords, I wish to focus my remarks on the R-word—redress—rather more than on the regulation side. Here before us, in the excellent amendment of the noble Baroness, Lady Hayter, is an opportunity to do something simple but clearly important which should have been done years ago—that is, to close the redress loophole in property lettings and management. The more one reads and learns about this issue, the more surprised one is about how we got into this muddled position that we are in today, with one department—BIS—taking a different view from another—Communities and Local Government.
As we have heard, change will be achieved by bringing letting agents and those who manage leasehold property within the redress net of the Consumers, Estate Agents and Redress Act 2007 and the main provisions of the Estate Agents Act 1979. Those Acts are both BIS Acts but, of course, housing is a CLG responsibility. The key thing that they do is, first, require all sales agents to be a member of an approved redress scheme and, secondly, give the OFT negative licensing powers to ban or reprimand sales agents for any misdeeds. However, neither Act has any sway over letting or managing agents, despite them interacting with consumers to an even greater extent.
I do not think that we should see access to redress as regulation. It is a consumer right and one of the eight consumer principles. It is true that consumers who are unhappy with their lettings or managing agent could go to court to get access to redress. However, as we know, very few do. These amendments are about mandating an alternative to court—alternative dispute resolution—which means that letting and managing agents must offer independent ADR to tenants, landlords and leaseholders. Therefore, I strongly support the intent behind these proposed new clauses. From the consumer perspective, they would mean that consumers with a complaint, after exhausting any in-house complaints procedure, if there is one, can take that complaint to an independent body approved by the OFT or its successor. This ADR will most likely be an existing body such as the Property Ombudsman, which already covers most sales agents, although I believe that there are other schemes as well.
What is the impact of this loophole? Surely it does not make any sense that a consumer who has a problem with a sales agent when selling, or even buying, a house has access to an independent complaints body, but if that same consumer—landlord or tenant—has a complaint about a lettings agent over a rental property or a problem with a managing agent who looks after their block of flats, they may not have access to independent ADR. While it is true that many, possibly a majority, of lettings managing agents are voluntary members of the Property Ombudsman—we have heard that already from the noble Baroness, Lady Hayter—there are around 6,000 firms of lettings agents that are not subject to it.
Why does it matter that we target them? One only has to read the briefing from Which?, along with that from many other organisations which have already been mentioned, to find the answer. The sector’s problems as outlined by the noble Baroness, Lady Hayter, and other speakers—and I am sure many others will continue in this vein—speak volumes. I shall not extend my time by reading out the Which? report giving various examples of landlords and tenants who have suffered in this way. Noble Lords will no doubt have a copy and can see for themselves.
I very much hope the Minister and the coalition Government will be able to accept the very reasonable and carefully defined amendment moved by the noble Baroness, Lady Hayter, not least in view of what a Minister in his role—Mark Prisk, now the Housing Minister—tried to do on a previous occasion.
Lord Deben
My Lords, the longer one has been in this House—or, indeed, in the House of Commons—the more one believes that certain statements are made irrespective of the Government. Somehow or other Governments take on a particular view about certain things, and regulation is one of those things. It seems to me that Governments often take a very narrow view about regulation and seem to think that if they regulate at all, they will be accused of red tape, of stopping businesses and of every heinous offence. That is the reason why the previous Labour Government refused to do this and why the present Government have introduced this Bill without this clause.
I hope the Minister will take it from somebody who has been in elected and now non-elected public life for nearly 40 years that it is the duty of Ministers to stand up against that attitude, because here is an issue where everybody recognises that there is only one sensible answer. It is not sensible to have a situation in which those who sell houses have a code that is different from the code for those who rent houses, because those who buy or rent houses think that they are working in the same context. Indeed, as it becomes more natural to buy and to rent in equal terms—I do not mean in numbers, but that people make those decisions—we must help the consumer in a sensible way. The only sensible way is the way so eloquently put forward by the noble Baroness when she pointed out that this is not regulation but consumer rights. It is the possibility of a consumer having a perfectly reasonable way of ensuring that they get fair do’s when they go to court.
It is very important for us to press this. I am speaking because I am a strong deregulator. I do not believe in the degrees of bureaucracy that we have managed to land on business. In my own business, I am conscious that there is a whole series of rules and regulations that restrict the number of people you take on and certainly stop the expansion of British industry and a lot of things that can be done. This has nothing to do with that. The only people who can dislike this light regulation are those who have every intention of misbehaving. When one reads that list of people who are supporting this, it is very hard to think of any responsible, respectable body, apart from the Caged Birds Society, that is opposed to this proposal.
I say this to my noble friend. Whatever is in his speaking notes—and I have a horrible feeling that I could write those notes, because there is a kind of parallelism with what I myself was given in the past, and was often willing to ignore—I hope that he will say to himself, “Least said soonest mended if I can’t give way”. If he cannot give way, some anodyne references would enable him to go back and say to the powers that be, “This won’t go. This isn’t acceptable”.
We must find a way to ensure that rogue letting agents do not get away with it any more. There is no argument that can be put up by BIS that can overcome the simple matter of the rights of the consumer. That is probably the elegant way through and I hope that he will be able to take it.
Lord Sharkey
I speak briefly and enthusiastically in support of Amendments 28ZH and 28ZJ. Other noble Lords have spoken eloquently and powerfully in favour of these amendments already and I do not want to repeat all their arguments, but I stress the real importance of this proposed measure to people’s lives. The absence of any kind of ombudsman scheme for letting agents is in itself an odd situation. It is tempting to say simply that if we can have an ombudsman scheme for estate agents surely it is obvious that we should have one for letting agents.
The absence of any such scheme for the private rented sector is not just an unfortunate gap in the regulatory or perhaps the redress landscape; it is an admission that can be the cause of real and prolonged distress. I have some personal experience of this. Two of my children lived in private rented accommodation until recently and for prolonged periods of time. The experience has been on the whole often unsatisfactory and occasionally downright distressing. On frequent occasions the dissatisfactions and distress were caused directly by the incompetence, inattention, procrastination and venality of the letting agent, and these were not always trivial occurrences. That is not surprising because we are discussing people’s homes.
We have heard a careful, well-argued and rational case for requiring letting agents to belong to an ombudsman scheme, but we should not let the rational and logical force of the argument blind us to the fact that the current situation can be and frequently is the cause of real emotional and financial distress. We know that the problem is widespread, with 40% of letting agents not signed up either to a professional body or a redress scheme. We know that it is the less well-off who experience the most dissatisfaction. We can see by looking at the amendments that the problem is easy enough to fix.
The amendment is not simply a tidying-up measure. It addresses a real, widespread, distressing and, above all, completely unnecessary problem. It is very encouraging to see that there is widespread support for the proposal of the noble Baroness, Lady Hayter, both current and historic. The noble Baroness has listed the current supporters and I would like to add my colleagues in the Commons to that list. Annette Brooke put down an Early Day Motion in the middle of last month calling essentially for the measures that are now before us. As for historic support, the noble Baroness has noted that as long ago as 2007 my honourable friend Mark Prisk argued forcefully in favour in the Commons.
I very much hope that the Minister will see the force in the noble Baroness’s arguments and in those of the other noble Lords who have spoken and of his colleague Mark Prisk. I very much hope that the Minister will be able to revenge Mark Prisk’s defeat at the hands of the previous Administration and accept this important amendment.
Baroness Brinton
My Lords, I certainly will not rehearse the arguments—in fact I have torn up half of what I was going to say after the excellent opening speech of the noble Baroness, Lady Hayter, on this particular amendment. But I want to report particularly that when the Liberal Democrats debated our policy paper, Decent Homes for All, we heard of some very personal examples from members that I found profoundly shocking. They included one letting agent who had taken on a policy of no single parents at all, even if they were offering a three-month deposit as a guarantee and even if they were happy to provide—which I would not have been—a separate guarantor. This particular letting agent had just decided that single parents, mainly mothers, were no good. This parent, in particular, had no form of redress at all to that.
What is in front of us today is an utterly reasonable way of getting that redress. I am grateful to the noble Baroness, Lady Howe, and the noble Lord, Lord Deben, for making the point that this is actually much more about redress and consumer rights. It is rare to see an amendment that is so widely supported not only from within the House of Lords but also in another place by various people, including Mark Prisk, Annette Brooke and others from the government side. I hope that even if the Minister cannot give us an instant answer today he will be able to engage in discussion with those who have spoken in the debate on this amendment prior to getting to Report stage.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie)
My Lords, it may not surprise my noble friend Lord Deben that I do indeed have some speaking notes, but I also hope that I can attempt at least to answer the questions that have been raised this afternoon by noble Lords. I know that these issues have been raised before, and I have considered carefully the amendments, arguments and indeed endorsements of the noble Baroness, Lady Hayter, for regulating the letting sector, particularly the ones that were mentioned this afternoon. She raises a very important issue.
I fully recognise the noble Baroness’s commitment in championing the interests of consumers in this area and take her concerns very seriously. It is helpful that she has brought it up in the context of this Bill. I note and respect the intervention of my noble friend Lord Deben in this respect as well. I know that the Housing Minister is aware of these concerns but I will raise them with him for further consideration. It is clear from the speech from the noble Baroness, Lady Hayter, that he—Mark Prisk, my honourable friend in another place—is aware of the issues that she has mentioned.
The noble Baroness, Lady Hayter, raised the issue in terms of a need for a mandatory redress to protect consumers, particularly those who are the most vulnerable. The Government are indeed keen to promote a greater use of redress but, understandably, want to avoid increased costs which might fall on landlords and tenants which a new mandatory regime would bring. While the Government acknowledge that poor practice exists in some parts of the letting sector, Ministers believe that new regulation would be disproportionate and would drive some businesses from the market. This would increase costs for consumers and reduce the choice and availability of accommodation on offer to tenants.
I can reassure noble Lords that letting and management agents are already subject to consumer protection legislation. For example, the Consumer Protection from Unfair Trading Regulations 2008 protect against giving false or misleading information, not acting with the standard of care and skill that is in accordance with honest market practice or claiming falsely to be a member of a professional body or approved redress scheme. The Unfair Terms in Consumer Contracts Regulations 1999 provide protection against unfair contract clauses, particularly where they are hidden in the small print.
Consumers who are treated unfairly or are charged unreasonable fees by an agent can seek help from their local trading standards officers, who have civil and criminal enforcement powers. The Office of Fair Trading has been investigating practices in the lettings sector and will be producing a report shortly including recommendations on how enforcement bodies can work to raise standards. We look forward to considering its report and recommendations. I hope that this particular point will go some way to reassuring the noble Baroness on the points that she has raised.
In addition to the protection offered by the consumer protection legislation, it is estimated that around half of all agents belong to voluntary schemes which set standards and offer redress if things go wrong. We invited industry bodies to work with us to improve the quality and coverage of self-regulation and in 2010 we endorsed the industry-led SAFEagent scheme. SAFEagent is designed to help consumers understand the benefits of using agents with Client Money Protection, by developing an easy to recognise logo. We are aware of the need for consumer awareness and also the importance of ensuring that vulnerable people are well informed, and indeed are advised as to what to do and where to go for help.
We have also published top tips for both landlords and tenants setting out the benefits of using an agent that belongs to SAFE agent or one of the professional bodies offering the right protections. We will continue to work with Citizens Advice and other bodies to ensure appropriate information is available. Citizens Advice provides help and advice on lettings over the telephone, online and face to face. In the light of these existing schemes and the consumer protection legislation in place, we have no current plans to introduce further statutory regulation. We are, however, keen to do everything possible to ensure that consumers are well informed and empowered to exercise their rights.
I was grateful for the intervention from my noble friend Lady Gardner who spoke most eloquently on the issue of the regulation of managing agents. I am aware that several issues have been brought to the Housing Minister’s attention in relation to letting agencies and residential leasehold and I am certain that managing agents are part of this. I am sure he is aware of your ongoing interest in this matter, but I will also inform him of the comments you made today. These are important issues to raise—as has been pointed out by the noble Baroness, Lady Gardner, there is a shortage of 300,000 houses in the UK. The letting of some of these properties must be effected fairly and consistently.
I hope that the noble Baroness, Lady Hayter, is reassured and will therefore be prepared to withdraw these amendments.
Lord Lucas
My Lords, I recognise a Treasury reply when I see it. I should be most grateful if the noble Lord would justify the first sentence of his reply by writing to me with the evidence on which that statement was based—that having this amendment passed would result in higher costs for consumers and a diminution in respectable firms in the market. That is just Treasury boilerplate. I very much doubt that they have done the work to justify that but I eagerly await the Minister’s letter to show me that I am wrong. In the absence of that, I very much hope that on Report we will deliver to my noble friend his first defeat as a Minister in the House of Lords. As he knows, this will not be a defeat for his department but merely for the Treasury and therefore one in which we shall all rejoice.
Baroness Gardner of Parkes
My Lords, we would all like to see that reply and I hope that it will be made readily available to everyone.
Viscount Younger of Leckie
Not only will I be very pleased indeed to reply to a letter that I might receive but I would be delighted to meet to discuss these matters fairly and fully.
Baroness Hayter of Kentish Town
The Minister will not be surprised to know that the lady is not reassured. I thank the noble Lords who have spoken for their support, not only the noble Lord, Lord Lucas, but also the noble Lord, Lord Sharkey, the noble Baroness, Lady Brinton and the noble Lord, Lord Deben, whose ministerial experience I am very grateful for, as well as the noble Baronesses, Lady Gardner and Lady Howe.
The problem with the voluntary scheme is that only the good agents belong. They are the members of the Association of Residential Letting Agents, which does not just get you in there—it educates you, awards certificates and does training. Very interestingly, ARLA also gets feedback from the ombudsman scheme to know what is going wrong and help them maintain their standards. The problem with the idea of using unfair contract terms is first that the consumer—whether it is a landlord or a tenant—simply does not know to go to them. Secondly, if an individual trading officer deals with something they will probably just deal with that one letting agent and there will be no feedback or ongoing case. I do not agree that this cost is disproportionate. The noble Baroness, Lady Gardner of Parkes, gave the figure of £150 to belong to a scheme: this is not going to put any letting agents out of business. The Minister also seemed to suggest that if any letting agents did go out of business—and they will only go out if they are bad and run off with clients’ money—this would somehow lead to less property. It will not: they will just go to a decent agency. It does not affect the number of properties on offer to tenants.
“Abolition of Agricultural Wages Board and related English bodies
(1) The Agricultural Wages Board for England and Wales is abolished.
(2) Every agricultural wages committee for an area in England is abolished.
(3) Every agricultural dwelling-house advisory committee for an area in England is abolished.
(4) Schedule (Abolition of Agricultural Wages Board and related English bodies: consequential provision) (abolition of Agricultural Wages Board and related English bodies: consequential provision) has effect.”
Viscount Younger of Leckie
The Agricultural Wages Board and Agricultural Wages Committees were set up in their current form nearly 65 years ago. The board was established at a time when there was little statutory employment protection for workers. Today the situation is very different and all workers are protected by the National Minimum Wage Act and working time regulations. Before I proceed any further, I want to reassure noble Lords that this Government firmly support the national minimum wage.
The Agricultural Wages Board is the only remaining sector wage council—all others have now been abolished. There is now no compelling reason why the agriculture sector alone should continue to be subject to a separate statutory employment regime. Let me explain why.
The agriculture industry today is very different. First, such businesses are often not just dependent on agriculture. Technological developments and increased mechanisation mean that there is no longer such dependency on manual labour in order to carry out agricultural functions. This has enabled businesses to expand and take on other, complementary work. The sectors within agriculture are therefore becoming increasingly diverse and many farm businesses now carry out non-agricultural activities alongside more traditional farming enterprises—for example bed and breakfast, and farm shops, where workers would not necessarily be covered by the agricultural wages order.
The agricultural wages order, which is made each year by the Agricultural Wages Board, takes no account of these changes within the agriculture industry. The process is one of “one size fits all” and this imposes a rigid and no longer appropriate structure on what are in reality nowadays myriad businesses that come under the umbrella term of “the agriculture sector”. The order is overly complicated and its provisions are wide-ranging and restrictive, hampering the ability of the industry to offer more flexible, modern employment packages. These amendments will end the separate statutory employment regime for agricultural workers in England and Wales and make amendments to the National Minimum Wage Act to bring the agricultural industry within the scope of the national minimum wage. The Government will also make amendments to secondary legislation to ensure that agricultural workers are adequately protected by the working time regulations.
The abolition of the Agricultural Wages Board and the associated agricultural minimum wage regime will enable farmers to offer terms and conditions for new workers that suit their particular circumstances and take account of the requirements of the specific farming sector. They will also be able to agree more flexible terms with existing workers by mutual consent. It will make it easier for farm businesses to employ workers, including taking on new workers, and encourage longer-term employment, thereby boosting growth and creating job opportunities.
The abolition of the Agricultural Wages Board will also mean that a single employment regime applies to all types of activities. This will bring transparency for both employers and workers, which is increasingly important given the diversity of farm businesses, not least in the interests of fairness and as the distinction between agricultural and non-agricultural activities becomes blurred. Even within the agricultural sector there can be confusion as to whether activities are covered by the agricultural wages order. For example, where a business packs and trims salad produce that is both grown on the farm and bought in, the packing of the home-grown produce is covered by the agricultural wages order, whereas the packing of the bought-in produce may not necessarily be. There are similar examples of confusion in the dairy and livestock sectors. Abolition will lift administrative and regulatory burdens from farm businesses and enable them to focus on their core business activity. It should encourage farmers to offer more in the way of longer-term employment, including the payment of annual salaries. All of this will encourage the development of a sustainable and prosperous industry for the future.
For the avoidance of any doubt, let me offer some further reassurance. Agricultural workers who have contractual rights reflecting the terms of the agricultural wages order at the time of the abolition of the board will continue to have those rights until such time as the contract might be varied by agreement between the employer and the worker or until the contract comes to an end. Moving forward, it is important to bear in mind that if agriculture-based businesses want to retain and attract able and well qualified people, they need to offer remuneration packages that are competitive. We know that the majority of workers in the agriculture sector already benefit from terms and conditions that are above the agricultural minimum wage rates. Currently, about 60% of permanent agricultural workers over the age of 22 are paid above the agriculture wages order minima. There is no reason why they should find themselves in a worse position in the absence of the board. The Government have asked the Low Pay Commission to include agricultural workers in its considerations when providing recommendations for all of the elements of the national minimum wage in order to achieve the smooth integration of agricultural workers in England and Wales.
Most of the functions of the 15 Agricultural Wages Committees in England have now lapsed in practice or been replaced by wider legislation. Their only remaining active function is to appoint members of the 16 Agricultural Dwelling House Advisory Committees in England, which are sometimes known as the ADHACs. The committees were established under the Rent (Agriculture) Act 1976 and their function is to give advice to local authorities on rehousing agricultural workers. As a result of changes in housing legislation, the number of requests for advice from ADHACs has declined significantly, to fewer than 10 in each of the last two years. There is no statutory requirement to consult an ADHAC and many local authorities happily take decisions on rehousing without such advice. I hope the Committee agrees that these 31 regional committees in England are now effectively defunct bodies and their continued existence at public expense cannot be justified. With regard to the abolition of the ADHACs in England, I want to assure noble Lords that there are no plans to change the provisions in the Rent (Agriculture) Act 1976 which give security of tenure to protected tenants, and therefore the amendments will not in any way jeopardise the position of tenants with protected tenancies under the 1976 legislation.
In summary, these amendments will bring employment practices in the agricultural industry into the 21st century, enabling sustainable growth for the future. They will also remove a number of obsolete public bodies and contribute to the Government’s wider programme of public body reform. I hope that, in the light of my remarks, noble Lords will accept them. I beg to move Amendment 28ZK.
Lord Whitty
My Lords, the Minister must realise that this is a bit of a controversial item. That is not surprising because in their latest impact assessment of the outcome of this measure the Government’s own best estimate is a cut in the living standards of rural workers in England by £236 million over the next decade.
Before I get on to the substantive points, of which I have many, I need to make a procedural point. I am not clear why we are debating the abolition of the Agricultural Wages Board in this Bill on this occasion. The amendments were put down two days before Christmas, without any prior warning. The Bill has been through the House of Commons. There was no indication in the House of Commons that the Government were going to come forward with this amendment in the House of Lords, which is very unusual, and, of course, everybody in the industry—on both sides of the industry and in Parliament—thought that the wages board was dealt with at primary-legislation level under the Public Bodies Act well over a year ago.
To implement that, the Government have to follow Section 11 of the Public Bodies Act, which lays down certain stipulations for bringing forward secondary legislation. It requires a full explanation to both Houses, a proper consultation period, the consideration of alternatives and a special memorandum to be laid before the House before it considers it. Why is this before us today when a procedure is already laid out and it appeared that the Government were prepared to go along that road until very recently? There was no explanation in the letter we got from the noble Viscount’s predecessor nor has there been any explanation from the Minister today. I can think of a couple of procedural reasons why the Government are in a bit of bother on this one. One of them is the Delegated Legislation Committee and the other one can be summarised by saying “Wales”.
Under the Public Bodies Act, the Government are already in serious trouble on a range of ways in which they have tried to bring forward the secondary legislation. The report of the Secondary Legislation Scrutiny Committee indicates that the Act requires a proper 12-week consultation, not the four-week consultation that Defra has sprung on us, and a full impact assessment followed by a government response to that consultation and a memorandum to Parliament. The Government seemed to start down that track, but the Secondary Legislation Scrutiny Committee criticises their behaviour in relation to other public bodies on a number of grounds: the lack of robustness of the government case; inadequate evidence; an inadequate approach to consultation with stakeholders; a failure to consider alternatives; and a lack of arrangements for future monitoring of the outcome. On pretty well all those counts, Defra and the Government are failing in the implementation of the Public Bodies Act in relation to the Agricultural Wages Board, so it must have occurred to the Government that it might be a bit easier to slip it into another piece of legislation, almost when nobody was looking over Christmas.
However, probably the biggest reason relates to Wales. This is, of course, an England and Wales body. As I understand it, the Welsh Government object to its abolition. The Welsh Government would like to see a continuation of statutory provision in agriculture which the Scottish and Northern Irish Governments have decided to have in relation to their own agricultural sector. Of course there is confusion here. If this was dealt with under agricultural legislation, and as agricultural policy is devolved, the Welsh Government would have equal rights to the Westminster Government and we would have to reach agreement with them on this.
Lord Plumb
My Lords, I declare an interest as a farmer and someone who has employed farm workers over a considerable number of years. It is for that reason that I am more interested in the substantive points made by the noble Lord, Lord Whitty, than in the procedural points. The procedural points he raised are worthy of some examination and I am sure that the Minister takes all that on board. The substantive points are what really matter—how people react to whatever decision is taken in the proposed removal of the Agricultural Wages Board.
I also declare an interest as, many years ago, a member of that board. I served on it for a while so I have some recognition of what it does and the importance of the workers, farmers and independents who served on the board—as they do now—who had the responsibility of trying to reach a fair conclusion in the interests of both parties.
I particularly remember when we had the threat of a farm workers’ strike, which had never been heard of in history. It became quite serious because the noises were coming from East Anglia when we were about to start sugar beet harvesting and potato picking and so on, and it was spreading across the country. I always encouraged my workers to become members of their own union; I was a member of a union and the leader of a union and told them that they had the same responsibility.
I remember saying to my herdsman, who had a pretty substantial responsibility looking after a lot of animals, “You are a very keen member of the NFU. Have you heard about this strike?”. He said, “Of course we have heard of this strike. We had a meeting last Wednesday night. Of course we have to join them—solidarity and all that”. I said, “What are we going to do? If you are going to join this strike, have I got to come home and do the milking?”. He said, “No, we will manage”. I said, “How can we manage if you are on strike?”. He said, “I will get up a bit early and do the milking, then I will have a bit of a strike and then I will do the milking in the afternoon”.
That story sums up very fairly the relationship between the farmer and the worker. They live and work shoulder to shoulder. They can discuss things that are not normally discussed between industrialists and their workers, because of the numbers and relationships and so forth, which are very different.
I assure the noble Lord, Lord Whitty, that I am a bit nearer to farmers than he is. I have talked to the workers and to the farmers. When they see that the difference between the national minimum wage and the agricultural minimum wage is 2p an hour, they say, “What are we keeping it for? It is plain daft to try to keep something going just for the sake of keeping it going”. What is the cost of keeping it? Is it £50,000? The figures will come forward, I think, but we know that a considerable amount is spent every year on running the various meetings, let alone the buildings, the staff and the offices.
Lord Knight of Weymouth
I hesitate to interrupt the noble Lord, who is such an authority on agriculture in this House, but the figure of £500,000 is not accurate. As a point of information, I think it is about £50,000.
Lord Plumb
I am inclined to agree that the figure is not accurate. I was quoting from the NFU. I am not the NFU. I was, but I am not now. I think the figure is considerably higher than that. If the noble Lord wants to quote that figure, I am very happy for him to quote it. I was merely quoting the cost of running the outfit, not the whole cost of the operation, including the buildings and everything else. If he wants to do that, I ask him please to produce that figure. I shall be delighted to receive it.
One notes that Unite, which represents farm workers on the board, is today campaigning against its abolition, which one understands, and argues that the plans will put thousands of rural and agriculture workers’ pay and conditions in jeopardy. I do not accept that. I know from experience what is being paid at the moment. You can forget your wages board and your minimum wage. If you are going to employ on your farm today someone who is going to sit on a machine that has probably cost £250,000, you are not going to pay them peanuts to try to get them into employment; you are going to pay them a good living wage. I am a great believer in giving these young people an opportunity to get into a share-farming operation. More and more people are inclined to that sort of determination as we look towards the future.
Rather than foster good labour relations, I believe that the present system is a source of friction and could certainly be done away with. The normal pattern is for the employers and the employees to take turns each year in being disgruntled. The board and the councils were established each year, and we had the Wages Council Act 1947. At their height, there were 100 throughout the country. They were progressively abolished, as we well know and have already heard, particularly between 1979 and 1997, leaving the Agricultural Wages Board as the only remaining example. If they were so vital, why did the previous Labour Government not restore them? Why did they not bring them back saying, “Other workers are going to be damaged”, as they propose farm workers are going to be damaged? They have not been, and we have not got wages boards there. We got rid of them, so why not do the same with agriculture?
Lord Howarth of Newport
My Lords, I always listen to the noble Lord, Lord Plumb, on matters of agriculture and, indeed, on other matters with the greatest respect, as do all noble Lords, but the fact is that my noble friend Lord Whitty has made some very powerful points indeed about what the impact of this policy is all too likely to be on agricultural workers.
I want to make only two brief points; they are both about process. The Government have tabled this amendment in order to remove a provision from the Public Bodies Act. The effect of tabling this amendment to the Enterprise and Regulatory Reform Bill is to undo what Parliament quite recently legislated in the Public Bodies Act. Only two days ago, the Opposition tabled an amendment to the Electoral Registration and Administration Bill and the House approved it. It had the effect of altering a provision in the Parliamentary Voting System and Constituencies Act, and there was the most almighty hullaballoo and complaint from the Government—the Conservative Party, certainly—in the House. The noble Lord, Lord Taylor of Holbeach, waxed eloquent in saying:
“Where does it put this House in the eyes of the people should the Committee choose to pass the amendment? We will not be seen, as we would choose to be seen, as the guardians of constitutional propriety”.—[Official Report, 14/1/13; col. 520.]
He said that the amendment would damage, “the delicate constitutional underpinning” of the relationship between the two Houses. He also said that,
“there are great dangers in that”.—[Official Report, 14/1/13; col. 522.]
I can only conclude that all that complaint about the constitutional impropriety of what the Opposition were doing was humbug.
I make no further comment on that, but I want to make a comment on the process that the Government have adopted in introducing the measure as they are now doing. I am told that they allowed only one week for consultation in Wales. I had the privilege of representing a Welsh constituency in the House of Commons and among my constituents were a number of agricultural workers. Any Member of Parliament representing a Welsh constituency is very well aware of the fragility and vulnerability of employment in the agricultural sector in Wales, which deals with very difficult conditions of all kinds. What is at stake in the policy represented in the amendment which the Government tabled is the incomes of agricultural workers. As my noble friend Lord Whitty said, they are poorly paid and in fragile employment. It is simply wrong to consult for no more than a week on a matter of such grave importance to those who would be affected by it. It is wrong and inhumane, and the Committee must deprecate in the strongest possible terms the way in which the Government have proceeded on this.
Baroness Byford
I would like to take the noble Lord, Lord Whitty, back to 2000 when we had a long debate on the CROW Act. Why do I refer to that? I do so because he has suggested that this bit has been slipped into another Bill. The CROW Act was four different Acts in one Act. The last bit dealt with areas of outstanding natural beauty. It went through the whole of the Commons before that bit was printed up at all. It then came to this House, and I was sitting opposite the noble Lord, Lord Whitty, when he introduced it formally at Second Reading. I said to him clearly at the time that I was not prepared to go into the Committee stage before we had that legislation before us to consider it as a whole Bill. So I think that his protesting too much about how this part of the Bill is being introduced is a little rich.
Lord Whitty
Since we are going down this historic road with the noble Baroness, which I am delighted at, the difference is that by then my right honourable friend Alun Michael had already signalled in the Commons that we would be coming forward with substantive provisions. Nothing was done in the same way on the same amendment.
Baroness Byford
I perhaps would not agree with him because, if I can take him further along down memory lane, the Bill was debated in this House, amendments were made and it returned to the Commons. Several Members who were in the Commons at that time will well remember that at that stage not one word of the amendments in the areas of outstanding natural beauty were debated in the Commons because it was guillotined. That is what happens. Therefore, the noble Lord is being slightly mischievous this afternoon in perhaps protesting too much.
However, I return to the substance. I should again declare that we are family farmers. We used to employ people but are now part of an arrangement with a neighbouring farmer who does the work for us. I also declare the fact that, like the noble Lord, Lord Plumb, we have always had a good working relationship with our employees. Many of them were housed on the farm and some still live in housing on the farm, many years after they retired. I would hate to think that other Members of the Committee, perhaps responding to the contribution from the noble Lord, Lord Whitty, believe that all is bad out there, because clearly it is not—and it should go on the record that it is not.
The noble Lord, Lord Plumb, referred to the hugely expensive machinery that we have these days. Obviously, you pay your workforce according to the work that they do. Personally, I am very happy to support the proposals that the Government are making, in that we should look again at what job these boards still do, and whether it is necessary. The introduction of the minimum wage in 1999 made a huge difference—two pence is what we are talking about, and most farmers pay more than that to a lot of their workers. The noble Lord also mentioned the fact that some employers have not practised well, if I can use that expression. I shall think of better words. I remind the noble Lord that in response to that his Government rightly brought in the gangmasters Act. There was a case recently in the paper where it was declared that two family members were employing people in dreadful conditions, underpaying them and keeping them virtually confined. That is an absolute disgrace and any practice like that should be hit on the head. It should not be allowed—and I use this opportunity to reinforce that point, because it is hugely important. Where there is bad practice, it should not be allowed. The gangmasters Act, which the noble Lord and I took through the House, has teeth and it should happen. I am therefore more resolved in supporting the Government in their proposals than I might have been had we not had the gangmasters Act behind us.
Today we live in a very different era from when we first introduced the Agricultural Wages Board. The workforce is smaller in many ways, and its members multitask in many ways—they are not just labourers. I know that reference has been made to horticultural workers. To a certain extent, that is much more mundane work because of the nature of what they are doing. However, for anyone who wants to get on in life and run a good business, the one thing you should always remember is that your business is successful only if your workers are well looked after and encouraged to work well.
I hope that Committee Members will support this move, which will allow the agricultural industry slightly greater flexibility. It may be that wages are slightly better in one particular area than another but in normal business, people working down here in London get paid more than they do up north. Nobody goes to town about that saying that it is outrageous. The responsibility is on the farmers to make sure that they employ fairly and pay fairly. In this day and age we do not still need the wages board. I support the government amendment.
Lord Hunt of Kings Heath
My Lords, that was an interesting contribution from the noble Baroness, who speaks from experience, but there is no guarantee that farmers will do the right thing. My concern, apart from the procedure, is that by removing the Agricultural Wages Board you are removing an essential safeguard. The noble Lord, Lord Plumb, also spoke with great experience. Both noble Lords gave us a rather warm-hearted view of how farmers will respond. Apparently, we can rely on them to do the right thing and pay much higher wages than are paid under either the minimum wage or the rates contained in the order issued by the Agricultural Wages Board—but I wonder.
If one looks at the evidence given during the very truncated consultation period, the fact is that the supermarkets will undoubtedly be looking to drive down those wages in order to ensure that they keep the profits themselves. That is the story in history of how the supermarkets have behaved time and again.
My principal reason for coming into this debate is that I, alongside my noble friend Lady Royall, led for the Opposition on the Public Bodies Bill. I find it extraordinary that we are debating the abolition of the Agricultural Wages Board in this Bill. We spent hours debating the Public Bodies Bill. We had two very good debates on the Agricultural Wages Board in Committee and on Report during passage of the Bill, and in no way was there any suggestion by the Government that they would not be using the process laid out in what is now the Public Bodies Act to deal with the Agricultural Wages Board.
We have lost the super-affirmative procedure, which would have allowed for extensive engagement and consultation with stakeholders. It would have allowed noble Lords who had an interest to have taken part in extensive debate. Instead, we have had this remarkably truncated consultation—four weeks for England and one week for Wales—when many people are engaged in other activities during the winter period. We all welcome the Minister to his place but it is remarkable that in his introductory remarks he gave no explanation whatever about why this amendment was being introduced at this late stage, why the Public Bodies Bill procedure agreed by your Lordships' House is not being used and why such a short consultation period was agreed.
The consultation has been discussed very recently by the Secondary Legislation Scrutiny Committee. It very helpfully undertook a review of the new approach to consultation by the Government. We have to go back only to November of last year when the Prime Minister made a speech to the CBI conference and said:
“When we came to power there had to be a three month consultation on everything and I mean everything”.
He continued:
“So we are saying to Ministers: here’s a revolutionary idea—you decide how long a consultation period this actually needs. If you can get it done properly in a fortnight, great, indeed the Department for Education has already had a consultation done and dusted in two weeks”.
We know where that has landed the Department for Education. The Prime Minister added:
“And we are going further, saying, if there is no need for a consultation, then don’t have one”,
at all.
We now have a remarkable situation where, instead of having a well ordered process to consultation, it is entirely up to Ministers to decide how long it should be. I should have thought that there would be the inverse rule of ministerial law, which says that the more contentious the issue the shorter the consultation will be. Here we sit: one week in Wales on the abolition of the Agricultural Wages Board when we know there is absolutely no support whatever for its abolition in Wales. No wonder it is a week. People should be grateful, should they not? Why not a day? Christmas Eve would no doubt have produced the result the Government wanted. The way the Minister’s department has acted is, frankly, a disgrace.
I refer the noble Lord to the evidence given to the Secondary Legislation Scrutiny Committee. It received a lot of evidence and, unlike the summation of the evidence that Defra made of the consultation receipts, which I regard as wholly inadequate, this is a very well ordered summation. The committee report refers to a quote from the Academy of Medical Sciences, which said:
“‘We are concerned that if adopting a consultation response time of less than 12 weeks becomes the default, this may prevent expert membership organisations from being able to provide considered responses to support evidence-based decision-making in policy … as so many legislative proposals impose additional costs on business, calculating their actual cost impact can often take time and resources’”.
The committee concluded that there was a,
“widely expressed preference for a 12-week standard duration”.
We can see from what has happened in relation to the Agricultural Wages Board why that should be the case.
The Fresh Produce Association, as my noble friend says, is a convenient front for the supermarkets; no wonder it is in favour. On the issue of what landowners’ companies will do, I noticed the Duchy of Cornwall Nursery response in the consultation. The manager there says: “Overtime rates are ridiculous”. We know what will happen to the overtime rates of Duchy of Cornwall employees when we abolish the Agricultural Wages Board. I doubt there will be any overtime rate at all. That is what will happen in practice when this wretched amendment is passed, if it is passed, by your Lordships’ House.
The Minister then talked about this being a “deregulatory” action. I was a Minister at Defra for a little while and I am reminding myself of the Agricultural Wages (England and Wales) Order. It is not a very long document and absolutely clear. It is one of the most readable documents that I have come across. Here is a very clear way for employers and employees to understand what the rates are and how to put them into practice. That is admitted by Defra, whose regulatory impact assessment, in talking about the impact on the affected groups, states:
“Employers will need to familiarise themselves with relevant legislation instead of”,
having to look at the agricultural wages order. I refer noble Lords opposite to their continued and frequent complaints about the complexity of employment legislation. I fail to see how getting rid of this very slim, readable document and replacing it with the need for hard-pressed farmers to go through and read Act after Act is, frankly, a nonsense.
The impact assessment goes on to say:
“Workers and employers will need to spend time on negotiations to agree pay levels & other terms & conditions individually”.
How on earth is that reducing the time and effort of both farmers and farm workers?
The Government are replacing a well ordered system, easily understood by everyone, with bargaining that will have to take place from farm to farm, involving both farmer and farm worker in the complexity of negotiations. Is there any group of workers who work harder than farm workers? I doubt it. Surely they are the “strivers” that this Government were so pleased to cite when Mr Osborne started to try to divide this nation up in a very disturbing and discomfiting way. We know that the real impact of this will be to drive down the wages of some very good and vulnerable people, and we ought to have nothing to do with it.
Earl Cathcart
My Lords, when these amendments came to my attention, my first rather tongue-in-cheek reaction was, “Blimey, does the Agricultural Wages Board still exist? I thought it went out with the ark”. I say that as a farm employer. When setting a farm worker’s salary, I have to pitch it to reflect the salaries in the wider market outside of farming; that is, the competition.
Within the past year, we have employed two new farm workers and I will use one of them as an example. Previously, he had been working for a road haulage firm, on a salary of £16,000. It became clear in the interview that he was keen to take our job and he seemed exactly the right man for it from my point of view. Getting him to switch jobs all rested on his salary package. I was advised that the job equated to about £7 an hour, which is just above grade 2 on the latest agricultural wages order scale. Let us look at the practicalities of using the agricultural wages order scale in negotiations. The prospective employee said, “What is my salary going to be?”. I replied, “£7 an hour”, because the Agricultural Wages Board only works in pounds an hour. He said, “What does that mean in gross per annum?”, because he wanted to compare my offer to the £16,000 from his existing job. I said, “That is £7 an hour grossed up for the year”. So we got out the calculator: £7 an hour times seven hours a day, five days a week, 52 weeks a year is £12,740. That is what the Agricultural Wages Board is saying I should pay him. He wanted the job and I wanted to employ him but the Agricultural Wages Board pay scale does not cut the mustard because he would not move jobs for a £3,260 cut in pay. I offered, and he accepted, £16,000—the same as he was getting from the job outside farming. The important point here is that it was the competitive wider employment market that determined his salary, not the agricultural wages order pay scales, which we ignored as not being helpful.
I asked my firm of accountants in Norfolk whether other farmers ignored the Agricultural Wages Board rates when setting salaries. Was I alone, and was I breaking the law? I now know that it is not strictly legal to pay a salary to a farm employee under the agricultural wages order. Happily, the accountants’ answer to both questions was no—I was not alone and it was not illegal. They said that few, if any, use the agricultural wages order rates nowadays because one has to pay over the odds to attract people into farming, especially if skills are involved, given, as my noble friend Lord Plumb said, the combine harvester worth £250,000—that is a big skill. I also asked my neighbouring farmers, who employ workers on their farms, and got the same answer.
Another point is that the way the Agricultural Wages Board works is archaic in that it sets pay rates per hour, rather assuming that we still hand out weekly wage packets. That is clearly impractical in today’s world. The preferred option for both parties is for a monthly standing order. If employers and their advisers are not using the rates set by the Agricultural Wages Board, what is the point of the board? Here is the rub because the practicality of today’s employment market has made the board obsolete. Also, the raft of modern employment law referred to just now has made the board irrelevant, not least by the national minimum wage that was just referred to, which currently stands at £6.19 an hour. The current minimum rate under the agricultural wages order is £6.21 an hour, a difference of a mere 2p, as has already been said. That 2p difference is not surprising because the board cannot set its minimum below the national minimum wage and it would look too simplistic to set it at the same rate—
Lord Hunt of Kings Heath
I am most grateful to the noble Earl for giving way. He has referred to the grade 1 rates, but he might have referred to the other grades listed in the Agricultural Wages Board order, particularly those around overtime. Where are the guarantees on those?
Earl Cathcart
If I may, I shall come on to that point later. As I was saying, the board cannot set the same rate as the national minimum wage because that would look too simplistic, so the rate is set at 2p more. Last year—surprise, surprise—it was also set at 2p above the national minimum wage. Next year, if the board still exists, I would hazard a guess that the rate will be set at 2p more. This is hardly rocket science.
Recent research shows that the average earnings of full-time farm workers are 40% higher than the rate set by the board and that in 2010 some 90% of farm workers received more than the grade 2 minimum. The conclusion must be that farm workers are paid well over the minimum set by the board. I have talked largely about full-time employees, but what about temporary workers? I would argue that they are and will be protected by the national minimum wage.
Apart from some noble Lords opposite, who does not want to see the abolition of the Agricultural Wages Board? It is the union, Unite, which is deploying scare tactics by saying that without the board farm workers will see reductions in their pay with only the national minimum wage to protect them. That is quite clearly rubbish. Going back to my employee on £16,000 a year, if the board goes, am I really going to reduce his pay to the level of the national minimum wage; that is, £11,300? I am not going to do so because he would not accept a drop in salary of some £4,700 and he would leave. That action would disrupt my business because I would have to interview new applicants, train the new person, and probably have to pay the new worker £16,000 to entice him to move from his existing job. It is highly likely that all existing employment terms and conditions will remain exactly the same as my noble friend the Minister has said, in spite of—
Lord Knight of Weymouth
Can the noble Earl square his estimation that no agricultural worker will lose any pay with the Government’s own economic impact assessment which states:
“Research suggests that workers’ wages may fall by £0-34.5m”,
A year, and that its best estimate is £32.5 million? Where is that £32.5 million going to come from if it is not from agricultural workers?
Earl Cathcart
I am not absolutely sure why—I can only give you my case—I would want to reduce their pay at all. As far as I am concerned, the system is working perfectly well. I am happy with their pay, and so are they. I do not know where those figures come from. My view is that it is highly likely that all existing employment terms and conditions will remain exactly the same, as the Minister has just confirmed.
Lord Whitty
I am sorry to pursue this point. The noble Earl may well be right in relation to his estate, but the department, which is supposed to know about the totality of the industry, estimates that there will be a significant cut in wages. Indeed, it is the major effect of this amendment in terms of the impact assessment. If the noble Earl is describing that argument as rubbish, it is not we on this side or United who made the argument, but the department, which got it seriously wrong. If that is what he is saying, it is another argument for the Government to look at what their information is based on.
Earl Cathcart
I am sure that the noble Lord will be interested to hear what the Minister says when he winds up.
I am happy to say that since employing new workers, my business has prospered. It may not be the norm, but the decision I have to make is not by how much I should reduce my employees’ salaries, but rather whether I should give them a bonus, a pay rise or a combination of both. It is a decision I shall make in spite of, not because of, the Agricultural Wages Board and contrary to the scare tactics that I suggest are being used by Unite.
If I wanted to expand my business beyond packing and selling my own farm produce by taking in produce from other farmers for packing and resale, any new workers for that expansion would not be classed as farm workers and would not come under the Agricultural Wages Board’s umbrella, so we would have the absurd situation of two people who are doing exactly the same job being paid at different rates—and all for 2 pence, which is a ridiculous complication. It is further complicated because I am told that if my expanded business had a busy period, say, before Christmas, under the Agricultural Wages Board’s rules I would have to pay time and a half to the agricultural workers packing my farm produce if they work more than eight hours a day or 39 hours a week. The workers packing my neighbouring farmers’ produce would be subject to the national minimum wage and paid the minimum rate regardless of the number of hours they work. What a dog’s dinner. I believe that the board is irrelevant in today’s employment market and an unnecessary cost to the taxpayer. It is outdated because it works on hourly wage rates, not salaries. Those who need an hourly rate are protected by the national minimum wage, and if the Agricultural Wages Board—
Lord Myners
I sense that the noble Earl is coming to the close of his comments. I want to remind him that he said he would answer the point raised by my noble friend Lord Hunt of Kings Heath; namely, that the higher grades are not protected by the national minimum wage. The noble Earl said he had an answer, and I think that the Committee is looking forward to hearing it.
Lord Hunt of Kings Heath
Perhaps I can help my noble friend. I am referring to grades 1 to 6: grade 6 is the farm management grade and the rate is £14.10 an hour; grade 5, which is the supervisory grade, is £13.05 an hour; and grade 4, the craft grade, which I suspect is the grade that the noble Lord has in mind, is £12.32 an hour, which on a 37-hour week comes to £22,000 a year. I really do not understand what he is saying.
Earl Cathcart
The noble Lord did raise a question and I did say that I would come back to it. This is all about the competitive market. I said before that one has to attract people with skills into farming and to pay a higher rate according to those skills, and that is exactly where I am; you have to pay a higher rate of salary—not a higher rate per hour—to the person with the greatest skills, and it is the competitive market that determines that price, which is normally higher than the Agricultural Wages Board rates.
I said that the board is irrelevant to today’s employment markets. It is outdated, working in hourly wage rates not salaries. Those who need an hourly rate are protected by the national minimum wage, and if the Agricultural Wages Board disappeared tomorrow I do not believe that most employers and employees would notice. Those who did would, I believe, breathe a sigh of relief as it would reduce the administrative burden on farmers and their advisers.
The noble Lords opposite have all argued strongly for the board’s retention, but they had 13 years in office to change, modernise and bring the Agricultural Wages Board into the 21st century. They chose to do nothing.
Lord Myners
My Lords, I welcome the Minister to his new role, although I feel rather sad for him that his debut is in promoting a Bill that most Members of the Committee will now recognise is a misrepresentation in its reference to the promotion of enterprise. I can say without any doubt after a career in business, including chairing a number of major public companies, that almost nothing in this Bill will have any beneficial impact on economic activity or on the growth of the economy.
This is a rather tawdry Bill, and we are now being asked to look at rather a shabby amendment. It must have been very clear to Members of the Committee that the Minister’s predecessor, the noble Lord, Lord Marland, did not really have his heart in the Bill at all. It was quite clear that he would much rather keep up his suntan overseas than put through legislation that will have such little economic impact.
The amendment has come about as the result of wholly inadequate consultation that is supported by evidence which is thin in the extreme, and the Minister will need to explain to the Committee why it is being proposed now. Why was it not incorporated into the original Bill? Why was it not mentioned, debated or discussed in the other place? Is it an afterthought? Was it overlooked when the Government were drafting not only the Public Bodies Bill but this Bill? If that is the case, those who work in the rural economy will have grounds for extreme grievance at the behaviour of a Government who can approach this issue, which is of great importance to them, in such a superficial and callous manner. My noble friend Lord Hunt of Kings Heath has already pointed out that by putting this amendment into this Bill, a number of procedures and processes that Parliament approved in the Public Bodies Bill will be avoided.
I noted the Minister’s strong endorsement of the national minimum wage and I declare my past role as chairman of the Low Pay Commission. However, as I listened to him I felt, as he advanced his arguments for the abolition of the Agricultural Wages Board, that one could have made the same speech and inserted the words “Low Pay Commission”. What is it about the Agricultural Wages Board that is different from the Low Pay Commission? His arguments about freeing up the economy, allowing the market to operate and establishing a market clearing rate apply to the whole economy. I ask myself whether we are seeing this shabby amendment incorporated into this Bill at such a late hour as a precursor for a deeper and more fundamental attack on the concept of the national minimum wage.
Lord Deben
My Lords, I declare an interest as the owner of a very small amount of agricultural land. I am also a former Minister of State for Agriculture. My only surprise is that it has taken so long to get to this point. It is unacceptable to say that the only people in the entire country who have to have a wages council after all the others have been abolished are we rural people. Actually, the insult is to us. The suggestion that there is only one group of people in the entire nation who need a wages board—because otherwise they will behave in a way that is wholly unacceptable—is offensive. It is offensive to my neighbours, it is offensive to rural people and it is not acceptable. That is the first thing.
Secondly, earlier I was rather tough with the Minister about what he may have written down. I could have written all the speeches on the other side quite simply because they have been said for the past 50 years. It is always the same thing—this argument that somehow or other people are out to do people down in an industry that is the most co-operative industry we have. You cannot run a farming enterprise—I do not run one but I see them all around me, and I was Minister for Agriculture and deputy Minister for the longest period of anybody—unless farmer and farm worker work together.
Thirdly, it is incredible to see the ignorance of what is happening in the industry, to hear speeches that assume that the industry today is like it was 50 years ago. Most people involved in the industry, by any proper measure, do not find themselves subject to the Agricultural Wages Board because the way farming is now organised and run is wholly different. Have we had a great campaign from Unite to say that the board has to be extended? Have we had trade unionists stamping in the street? Of course not, because they know perfectly well that this is an out-of-date mechanism which they do not want to bring back in any of the areas where it has been abolished. The previous Government had 13 years to do something, but they did not.
Lord Knight of Weymouth
I would like to revisit history very briefly. As I understand it, the wages councils for every other sector were abolished in 1993, the same year that the noble Lord finished being Minister of State for Agriculture. He must have been part of the discussions held then as to whether or not the Agricultural Wages Board should be abolished along with the others. Can he explain why he chose not to abolish it then?
Lord Deben
First, I do not remember whether I was still there or not because it was the year in which I moved. Secondly, I have always been opposed to the Agricultural Wages Board and have always said so because it has never seemed to apply to the industry that I know. It may have applied in 1930. It may have applied in the long-distant past in 1830, although we did not have the board in those days. This is what worries me about the speeches from the other side. I do not feel that they understand how agriculture works.
The former Member for Newport talks about agricultural workers in Newport. I must say that my mother was brought up there and there must be a pretty exiguous collection of people in Newport. However I say this: those of us who live in agricultural areas, care about agriculture and have spent a lifetime dealing with it have to say that the speeches from the other side have no connection with reality at all.
Baroness Turner of Camden
Is the noble Lord not aware that other employers in the industry feel very differently and find the Agricultural Wages Board useful and helpful? I was speaking to one such, a noble Lord, on precisely that point today. I do not know very much about agriculture, but I know quite a bit about employment rights, and I happened to mention this matter to a friend—not a noble friend but a friend—who is involved in agriculture in a large way. He told me that he respected the Agricultural Wages Board. He had always found it useful and was surprised that the Government were moving in the direction of abolition. It was clear that there had not been overall consultation. This is apparent from a number of the contributions today; there has been no real, deep consultation on the amendment.
Lord Deben
I am sure that the noble Baroness would agree from her long history of trade union negotiations that you can always find someone who takes a differing view. However, I have to tell her that if one talks to farmers throughout the country and to large numbers of farm workers their view is simple: this board has been an irrelevance for a very long time. Many of them feel it to be an insult to suggest that this portion of humanity, this group of people, should be singled out and defended on the basis that they cannot be trusted to run their businesses or to negotiate in the way that everyone else in Britain does.
I particularly objected, if I may say so, to the comments of the noble Lord who suggested that it would be much easier to keep the wages board because it is too complicated for farmers and farm workers to negotiate. My goodness, what a miserable society it is in which we have to have things done on a collective basis because individuals who work with, talk to and care about each other are unable, too stupid or do not have the time to work out the relationships between them, both financial and in terms of employment. It is a harking-back occasion. This Committee often reminds me of discussions—
Lord Hunt of Kings Heath
My Lords, the noble Lord has mentioned me, and it would only be courtesy to let me—
Lord Deben
I have made it quite clear that I will give way, but I should have a chance to finish my sentence before I do. I am very happy to give way to the noble Lord, who I much respect.
I was saying merely that before we indulge in historical references, we ought to remember that we are talking about people working today, who are employing today, who are alive today, who listen to these comments and who recognise in them a kind of attitude of superiority to rural people that many townspeople appear to have by believing that they are not fit to run their own lives like townspeople can.
Lord Hunt of Kings Heath
My Lords, I am grateful to the noble Lord for giving way because he mentioned me as the noble Lord who had referred to problems in reading legislation. The Bill is called the Enterprise and Regulatory Reform Bill. The Minister told us that it would be great to get rid of the Agricultural Wages Board because it will remove a whole raft of regulations from the industry. The point I am making is that the regulatory impact assessment produced by the Minister’s own department has a wonderful phrase that,
“employers will need to familiarise themselves with relevant legislation instead of the Agricultural Wages Board Order. Workers and employers will need to spend time on negotiations to agree pay levels and other terms and conditions individually”.
My point is that far from easing regulatory burdens, this will increase the burdens in an area of industry that is characterised by many small employers with a limited number of employees. I would argue in favour of the simplicity and straightforwardness of the order, which is incredibly easy to understand and well written. I know that if I was a small employer, I would welcome it. The current arrangements are much less of a burden than having to refer to dozens of Acts of Parliament, which the noble Lord’s department seems to think will have to be done in the future.
Lord Deben
I have listened carefully to the noble Lord, as I have on other occasions, and I think that he is missing the point. Indeed, he has revealed exactly the kind of concern that I have. Most of the employers of agricultural workers are larger employers because most of the smaller concerns do not employ any longer. That is one of the issues. To talk about the agricultural industry from that point of view is to talk about an industry which has passed. Ever since the passing of the Hunting Act we have gone through periods of listening to townspeople who do not know about the countryside talking about it in a way that they would find insulting if we who live in the country talked in the same way about the towns.
I say this to noble Lords opposite. It is impossible to defend an argument which says that uniquely among all jobs and professions, uniquely among all employers and uniquely among all employees, the small part of the agriculture and food industry to which this wages board applies has to be protected because it cannot otherwise stand up for itself. That is manifestly untrue, and it is insulting to a large section of the population. It also means that those of us who live in the countryside must again remember that people in this House and in the other place often debate our future with exiguous knowledge of what actually goes on Britain’s rural areas. I shall give way to the former Member for Newport.
Lord Howarth of Newport
I am grateful to the noble Lord who knows my former constituency so much better than I and who insists that although I represented a rural constituency for 15 years, I know nothing about agriculture. I represented farmers and farm workers for many years.
The noble Lord has still not answered the question put to him by my noble friend. Why, when he was the Secretary of State for Agriculture, did he omit to abolish the Agricultural Wages Board?
Lord Deben
First, I think I did say that I could not remember whether the decision to do the wages board came before or after I ceased to be the Agriculture Minister. I am being absolutely truthful about that. Secondly, I was never in favour of the Agricultural Wages Board, but I also remind the noble Lord that the decision to abolish these boards was taken as a whole. In those circumstances, I would have played a part, but, as a matter of fact, I do not think I did because the timing was rather different. I would just say to him that if I had had the opportunity, I would have done so. He might remember that I had a number of other things to deal with at the time, but we do not wish to go into that otherwise people will recall the photograph which was so widely used.
The issue I want to return to is this. I am not insulting the noble Lord. Of course he knows about agriculture because in a different guise he represented an agricultural constituency. I am merely saying that the language we have heard from the noble Lord, Lord Whitty, and those who spoke later, including even the upright defender of Cornwall, does not go down well with those in agricultural areas who want to be treated like everyone else: grown up and able to look after themselves. Their employment practices are decent and the relationships between employers and employees are particularly tight. The gangmaster regulations removed the only part of this which might have been argued, even though the agricultural workers regulations did not always cover the very people we wanted to help. I commend the previous Government for bringing that forward, and I am only sad to see that there is an innate conservatism in the trade union movement which makes it impossible for it to understand that the world has changed and with it we have to change our practices.
Lord Monks
My Lords, I respond, as a former general secretary of the TUC, to that last remark about the trade union movement. I cannot claim any rustic origins—I do not come from that part of the world—but I do claim some experience of rural life gleaned, at great expense, in various village pubs over the years, listening to what people say. While I accept that the degree of paternalism that often exists from the farmers’ and landowners’ side is often genuine and sincere, and we have heard some of that today, it is not the full story of rural life. It is not an idyll for everybody, some place where Beethoven’s Symphony No. 6 wafts gently in the background and people are all very nice to each other. That is not the case. There are some dark sides and some problems which are not being faced up to on that side.
Over the years, I have not been a great fan of wages councils or the Agricultural Wages Board. I say to the noble Lord, Lord Plumb, that the National Farmers’ Union has plenty to do with the fact that it is very difficult to be proud of the Agricultural Wages Board because it is a very tough negotiator. It can always answer for itself. It is good at it. If anything is irrelevant, as the noble Earl, Lord Cathcart, suggested, it is often because the employers have not wanted the board to address some of the problems that were brought to their attention. I take a rounded view which is certainly not old-fashioned. Some of the rates of pay that have been contracted for people driving a machine worth £250,000 or whatever do not seem excessive. When I look at the figures for farm incomes, I accept that there are good years and bad years, but they went up by 25% in 2011. I did not see a trickledown effect in the Agricultural Wages Board or any of the other agreements which were around. Farmers were, no doubt, thankful for a good year after some bad ones, but they were not exactly shelling out the money generously to their staff.
I ask the NFU and others, and I look forward to what the noble Lord says on these things, whether where there are shortages in the industry and a reliance on migrant workers it could be because the wages and conditions are still too low? Could it be because it is not an attractive place for young people to go to work and the prospects for replacing the ageing workforce are not fantastically good? I look forward to what the Minister will say on these things. This debate is about pay and conditions in agriculture as well as about the wages board. The wages board, like the wages councils, was in the words of Winston Churchill, a floor beneath wages. They are not a restriction which stops you from paying more. They are simply a floor, and if you do not go below it, you are clean. However, there are plenty of people who do go below it. I could quote examples, particularly from the horticultural industry, where some quite substantial employers went below the wages council order and were in difficulty when they were caught.
I ask the Government to follow the wise advice that has been given by my noble friend Lord Whitty and take a longer, deeper look at this. I am not against change, reforming, making the thing more relevant and all the rest of it, but this industry has different features. There may be some other industries around that you can compare it with, but they are not on our agenda today. Rural life, close relationships, living cheek-by-jowl—not always, but often—make this a rather special place, and that justifies the continuation of the Agricultural Wages Board.
Lord Cameron of Dillington
My Lords, first, I apologise for missing the first part of this debate. I am afraid that I was unaware that this debate was taking place until very recently.
I thought that we had put this whole issue to bed with the Public Bodies Bill. We went through all the arguments, we discussed it, we voted on it, and I thought that the Agricultural Wages Board had been abolished. Anyway, let us go through the arguments again.
There is no doubt, as many noble Lords have said, that the Agricultural Wages Board is and has been a very useful guide to farmers. I totally accept that. In some ways it is a bit of a cop-out for farmers because they can look it up on a piece of paper and know what they are going to pay their workers. It has been a useful guide not because of the actual rate set—because in fact the majority of farm workers are paid above the Agricultural Wages Board rate—but because of the percentage increases that have been given. This function can be easily replaced by other means, and the NFU has already committed to replace it.
It is no surprise to me that the majority of farm workers are paid above the Agricultural Wages Board rate. As the noble Lord, Lord Plumb, said, with machinery costs—actually his figures are slightly out of date because you can get tractors nowadays that cost £400,000 to £500,000 and combines that cost nearly £750,000—would you seriously pay someone the minimum wage to drive such equipment? I very much doubt it.
As the noble Earl, Lord Cathcart, said, rural competition is huge. Agricultural employment represents around 4% of the rural employment statistics. The competition from other industries is big, and you will not get people to come to work as farm workers. As the noble Lord, Lord Monks, said, the prospects for replacing the current workforce are not particularly good. They will not be particularly good if farmers do not pay proper wages, which I personally believe most farmers do, certainly on my farm and my neighbours’ farms.
The noble Lord, Lord Deben, said that farming is a very co-operative industry, and I absolutely agree. You live and work—and even play—as a team on a farm. Quite often, you are in a remote area. You cannot treat them as a distant workforce. You have to live next door to these people, meet them in the pub and so on, and it is a very co-operative industry. Frankly, I do not believe that farmers will immediately make use of the absence of the Agricultural Wages Board to behave completely differently towards their teams from how they do at the moment.
The noble Lord, Lord Hunt, said that the supermarket interests will get the better of us and we will have to put wages down. If you sell commodities to the supermarkets, they put you through a whole series of tests, such as Nature’s Choice for Tesco, and one of the main chapters is how you treat your workforce. I do not agree that the supermarkets will impose such tight margins that agricultural wages will naturally have to come down. I cannot see that as the logical conclusion to the abolition of the Agricultural Wages Board.
The board has been a useful guide, but the NFU has committed to produce comparative indicators to help us, such as the cost of living changes, the labour market, comparative industries, farm business conditions and so on.
On farm business conditions, it is not as tough a life as it used to be. Tractors have heating, stereophonic sound and CD players, and you have to produce all these things to attract your farm workers nowadays. It is a completely different life from the image that I seem to be getting from certain noble Lords.
All the agricultural bodies—the CLA, the NFU and the TFA—have been consulted and agree that, frankly, a statutory board for a single remaining industry is completely unnecessary in today’s world, and I very much agree with that opinion.
Baroness Donaghy
My Lords, I was a member of the Low Pay Commission when it was first established, although I did not have the pleasure of serving under my noble friend Lord Myners. We set the first statutory national minimum wage, which was applied to thousands of farm workers who were not covered by the Agricultural Wages Board. It did not render the AWB irrelevant, because the AWB dealt, and deals, with a wide range of other issues relating to the grading structure, pay above the grade 1 level, training, and other important terms and conditions.
Although I am aware that abolition has the support of the supermarkets, the horticultural industry and, regrettably, the NFU, I believe that the country will suffer and that we will come to regret this move if it is carried out. We know about the sorry process, so I will not repeat it. May I ask whether the proposal has the support of the Welsh Assembly Government? Will similar measures follow in Northern Ireland and in Scotland? In other words, have they been asked for their view in Northern Ireland and in Scotland?
The proposal will have a detrimental effect on most agricultural workers. Recruitment is already difficult, and the Agricultural Wages Board has been particularly strong on building a career structure for farm workers, strongly supported by the NFU, I should say. Farms with between one and four employees will find it impossible to resist the relentless pressure on pricing, and I have to disagree with my noble friend who has just spoken; the pricing issue will bring enormous pressures to bear on bringing down the cost in many farms. Their standard of living is already comparatively low, and the wages board was to an extent protection against that downward pressure. Small farms will also have to carry out their own negotiations on pay. That might be perfectly possible—of course, they are not stupid; I would not dream of saying that they are— but it is an extra bit of work on top of a heavy workload.
The most recent impact assessment has revealed a much greater detrimental impact than the first one, and I ask the Minister why there is that difference between the two impact statements. Does he have any assessment of how many small farms will go to the wall as a result of abolition? We know what will happen in horticulture; the staff will all be temporary, all immigrants, and all on grade 1, which is the equivalent of the statutory national minimum wage. To rely just on the minimum wage and the working time directive is to throw out the baby with the bath water. That is not to say that the board itself does not recognise the need for change and the need to give its constitution more flexibility. It has said so itself.
If I were still chair of ACAS and were asked what I would do to replace it, I would have supported the idea of a joint industry council with an independent chair and a conciliation and arbitration mechanism where there is a failure to agree. The parties involved in the AWB have already called for this. The Minister in the other place has called for salaries and not just wages to be paid, something to which the noble Earl, Lord Cathcart, referred. Again, this could be done without abolishing the board. It seems to me that the Government are hell-bent on abolition. Presumably if they do not get their way in this Bill, they will begin again in another Bill whose subject matter overlaps with half a dozen other Bills, which seems to be the coalition Government’s theme.
As the Minister knows, a lot of overtime is worked in the industry. At present, that is paid at the rate of time and a half. I thought it was 39.5 hours, but somebody said 39 hours, and I stand to be corrected. This will be in jeopardy, and workers may face an 80- to 90-hour week in an industry which is the second most dangerous after the construction industry. The workers might put themselves at risk simply to make up for lost income in order to feed their families. Have the Government assessed the impact on health and safety if pay levels fall and excessive overtime is worked?
The Minister in the other place, David Heath, has recognised the skills shortages and the importance of “rewarding well paid careers”. Amen to that, but the future of farming must take account of the needs of small farmers, not just agribusiness, if we are to protect our food supply for our country. Have the Government given up on small farmers? The industry is a special case because it enjoys a £3.4 billion taxpayer subsidy. In 2011, these payments accounted for around 60% of total farm incomes, so they are practically in the public sector. Farmers and farm workers are special because they help to feed the nation. I ask the Minister: if he succeeds in abolishing the Agricultural Wages Board, which will be a sad day for this country, what will he put in its place?
Lord Knight of Weymouth
My Lords, we have had an excellent debate and heard the arguments very well put on both sides. I shall start my comments with reading to your Lordships some of an Early Day Motion that was put down in the other place in June 2000. It said,
“this House notes that … the Agricultural Wages Board also sets a series of rates of pay to reflect the varying qualifications and experience of farm workers, thus providing a visible career structure for recruits going into agricultural work and is used as a benchmark for other rural employment; is nonetheless concerned that average earnings in rural areas are considerably lower than in urban areas; believes that any weakening of the Agricultural Wages Board or its abolition would further impoverish the rural working class, exacerbating social deprivation and the undesirable indicators associated with social exclusion; and therefore calls on the Government at the conclusion of the current review, to retain the Agricultural Wages Board as it is currently constituted”.
I read that out partly because it summarises the argument that I want to make but also because among the names of those who signed the Motion are some who are now Members of your Lordships’ House; for example, the noble Lords, Lord Clark of Windermere, Lord Campbell-Savours, Lord Taylor of Goss Moor, Lord Tyler and Lord Jones of Cheltenham. The name David Heath stands out. He is the Liberal Democrat Minister responsible for abolishing the Agricultural Wages Board now, so I wonder what has changed in the intervening 12 and a half years for Mr Heath. I think there are very important principles at stake here.
I pause at this moment to correct something in the intervention I made on the authoritative noble Lord, Lord Plumb, about getting the facts right. I checked the Government’s impact assessment, which has been very helpful to us during this debate. It says that the cost of running the board over 10 years is £800,000— £0.8 million—which equates to about £80,000 a year, so I was wrong and the NFU was wrong. I apologise to your Lordships if I corrected the noble Lord incorrectly.
The principle of a rural living wage is important. If you are poor in rural areas, it is a particular struggle. The quality of life in rural areas attracts asset-rich retirees and second-home owners, pushing up house prices, and local shops are a long way from distribution centres and competition is limited because of the geography, meaning that prices are higher than average. In its 2010 report, the Joseph Rowntree Foundation said that it costs 10% to 20% more to live in rural areas.
Average wages are relatively low for the working population, with the predominant sectors being cleaning, care, hospitality and working in micro-businesses. If you are lucky, you will get a job in the public sector. Where I live in Dorset the largest employer is the local council, where you will have decent job security and a reasonable wage—if you can get a job there. But of course rural councils are in turn underfunded, and I am happy to be part of a group being led by Graham Stuart in the other place that is campaigning to get better funding out of this Government for councils in rural areas. Of course, the best way out of poverty is work, but only if work pays. Topping up low pay through the tax system by means of tax credits is one good way of achieving that, but better still is for employers to pay decent wages. That is why we should be campaigning for a rural living wage and why we should be retaining the Agricultural Wages Board.
My noble friend Lord Whitty talked about the position of Wales in his excellent opening speech. We have heard from some speakers who support this abolition that farmers are united in their agreement that the Agricultural Wages Board is irrelevant and does not serve any purpose. However, the Farmers’ Union of Wales cites three good reasons for retaining it, saying that it reflects the unique labour requirements of the agricultural industry and that to abolish it would be a retrograde step for an industry which in recent years has been struggling to attract new skills and expertise. The three reasons are, first, that the economic climate in the agricultural industry has made it a less attractive option for young people. In the union’s view,
“rewarding skills, qualifications and level of responsibility is a vital means of persuading high calibre people to remain in or enter the industry”.
Here I pay tribute to the noble Lord, Lord Plumb, for the foundation that he has set up and I was pleased to be able to attend its launch. The union goes on to say that,
“reliance on a single national minimum wage will inevitably result in an erosion of talent and skills from farming as more lucrative and less physically challenging professions are taken up”.
The second reason given is that:
“Agricultural workers are required to be flexible in their working arrangements to cover busy periods, fine weather and unsocial hours which are not covered by general employment law provision”.
The union believes that there is a still a vital role for additional minimum rates of pay across the six grades for agricultural workers. The final reason given is that it is an,
“important means of avoiding potential conflict and lengthy negotiations with individual staff”.
People do not want the burden of negotiation that abolition would bring. That is the view of the Farmers’ Union of Wales. It tells noble Lords that not all farmers are by any means agreed that abolition is a good thing.
We have been privileged to hear from the noble Lord, Lord Plumb, who is a former member of the Agricultural Wages Board for England and Wales, but I want to repeat a short passage from a letter written by a gentleman called Barry Salmon, a member of the board who is just about to retire. He is particularly concerned about training and attracting young people—a common theme when I researched this issue. He states in his letter to the right honourable Owen Patterson, the Secretary of State, that if he proposes that the board must go, things like training and a proper wage structure will be lost:
“Come and work in the farming industry, a rewarding industry to work in, one that requires skilled employees, high skill levels will be required and training can be given, a willingness to continue to train to meet new demands is essential, workers must be able to work on their own initiatives and take day to day responsibility for what they do. At busy and demanding times long hours are worked for which overtime rates are paid”,
which, incidentally, is not guaranteed in the minimum wage structure but is guaranteed, whatever you are paid, in the Agricultural Wages Board structure.
“All of which is true but the rewards don’t look likely to encourage new trainees into farming, no pensions, no sick pay, no entitlement to time off for such things as bereavements and worst of all the National Minimum pay scale applies with no formal structure above that to reward training. I cannot believe schools are going to encourage pupils with the good practical skills needed to take up a career in farming”.
He starts to point out some of the other benefits—
Lord Deben
First, I hope that the noble Lord will explain to the Committee that there is a distinction between the Farmers’ Union of Wales and the National Farmers Union of Wales, which of course voted in the opposite direction. There is a disagreement.
On the point that the noble Lord just raised, all those elements are in every other industry to which teachers might encourage people to move. Why would they not ask them to go into farming if there were no Agricultural Wages Board but would ask them to go into all these other industries that do not have a wages board? That does not stand up.
Lord Knight of Weymouth
I am afraid that I disagree with the noble Lord about the unique nature of agriculture. It is right that we have agricultural colleges giving specific training, specifically feeding an industry with the skills that are needed. People need to have that training and understanding of the unique way of life, in terms of working very anti-social hours at times and having to be highly flexible in the way that they work. Some 30% of farm workers have a boss who is also their landlord. There are a number of unique things about agriculture—he disagrees and I respect his disagreement—that I do not know of in other sectors.
Baroness Byford
I apologise—too many years in opposition. I take the noble Lord up on the agricultural colleges and universities—because two of them have become universities recently. I do not think that that has anything to do with what my noble friend was saying. The agricultural colleges are hugely important. They have an important role in encouraging young people to come into the farming industry. But it is a very different industry from what has been described by several colleagues on the other side.
Lord Knight of Weymouth
I mentioned agricultural colleges because I am not aware of another sector that has a specific network of colleges for its training. There is something different and unique about agriculture, which is very important. There may be others that other noble Lords want to mention. Maybe if I racked my brains I could come up with them, but I think there is something unique about agriculture.
Other benefits are attached to the Agricultural Wages Board. For example, there is the entitlement to rest breaks, overtime, paid holidays and even the allowance of £7.63 per week for working dogs. There is an on-call and night allowance. All these things are negotiated. They are all part of the reason why agriculture can be regarded as a special case.
Earl Cathcart
I am not very good at employment law; I have to be frank about that. Are you saying that my man to whom I am paying £16,000, which is nothing to do with the wages board or that side of it, does not have holidays, sick pay or all the other entitlements that any other employee in every other walk of life has? Of course he does. In my view it is not the wages board that is protecting him. He has normal employment rules and regulations, enjoyments and privileges.
Lord Knight of Weymouth
I am most grateful to the noble Earl and his helpful intervention.
Under the national minimum wage legislation, there is no minimum statutory level of overtime. Under that legislation, you have an entitlement to 28 days’ paid holiday as opposed to 31 days under the Agricultural Wages Board. There is also a maximum of 38 days for workers working more than six days a week under the Agricultural Wages Board, with no additional entitlement under minimum wage legislation. In terms of rest breaks, under the Agricultural Wages Board you are entitled to not less than 30 minutes where the daily working time is more than five and a half hours, whereas under the minimum wage legislation—
Lord Hunt of Kings Heath
Will my noble friend give way? I remind him of some of the evidence that came from the Duchy of Cornwall Nursery. The manager wrote in to say that he supports the abolition of the AWB and that “overtime rates are ridiculous”. Does that not give a clue to how some people in the industry will act if the AWB protections are abolished?
Lord Knight of Weymouth
The noble Lord makes a good point. He quotes evidence and I do not need to add to it.
I could go on to help the noble Earl. The final point, which I think is most striking, is the entitlement to paid sick leave and the level of sick pay received. Under the Agricultural Wages Board, all workers, whether or not they are paid the minimum, are entitled to 13 to 26 weeks on full pay after one year’s continuous employment, after which statutory sick pay applies. Under minimum wage legislation, statutory sick pay—currently £85.85 a week—applies where a worker has been sick for at least four days or more and has average earnings of more than the lower earnings limit, which is now £107 a week.
Earl Cathcart
I thought that it had been established that 90% of farm workers are paid above grade 2 in the scales—£6.50 rather than whatever the level is under the AWB. They are not being paid as minimum wage earners. They are getting a proper wage like anybody else who might be employed is getting a wage. I concede that temporary workers are paid the minimum wage, but normal salaried farm workers are paid well above that.
Lord Knight of Weymouth
The important thing to remember is that these legal entitlements for the agricultural sector apply regardless of whether your wages are at or above the minimum level set by the Agricultural Wages Board. These entitlements—for one and a half the usual rate for overtime, for example—are there regardless of what you are paid. That is an entitlement in law and we should protect it. I think that it is a good thing for us as parliamentarians to protect these minimum standards for workers, which would go if the Government were successful with their amendment to abolish the Agricultural Wages Board.
Unfortunately, some people do not act as responsibly as the noble Lords who have spoken and declared their interests as farmers. I point to the case of Chris Blakeney of Marden Management Ltd, who has just recently been in court in Swindon, where he changed his plea to guilty in respect of his activities as a gangmaster supplying 500 workers to farms across the country from his base in Calne. There are bad people around exploiting workers. When this protection goes, that exploitation is likely to grow.
A good argument has been made on this side of the Committee for the retention of the Agricultural Wages Board. What about the arguments against? I looked at the letter from the noble Lord, Lord Marland, the noble Viscount’s predecessor, to my noble friend Lord Stevenson on 19 December, when this amendment was announced. I note the manuscript amendment to the letter written by the noble Lord, Lord Marland, in which he said, “I reluctantly agreed to this—decision above my unpaid grade!”. That clearly suggests that the noble Viscount’s predecessor thought that this was all a bit dodgy. I would be interested to know whether the noble Viscount agrees with his predecessor about the dodginess of this amendment.
I then looked at the letter from the noble Lord, Lord De Mauley, whom I am pleased to see in his place. I think that we have answered most of the questions. The noble Viscount repeated the notion that this will improve employment but, as we have said, the impact assessment—on page 19, in paragraph ii, headed “Employment”—says:
“This effect is highly uncertain, and may therefore not be significantly different from zero”.
The Government anticipate no employment effect at all.
We have heard the arguments around whether agriculture is unique—people take different views on that. We have also heard the concerns about consultation. The lack of consultation on the amendment is truly shocking, given that 154,000 workers are directly covered by it. Four weeks’ consultation is completely inadequate for such a measure. There is then the problem of the number of people who were not included in the list of consultees. Action with Communities in Rural England was excluded. The various training organisations, such as Lantra, were not included. Housing bodies, such as the National Housing Federation and Shelter, were not included, even though the housing committees are being abolished. Even the Arthur Rank Centre was not included, despite the important role that we know the church plays in rural communities.
The consultation has been shocking. The procedure has been ignored. I would have welcomed a four-week consultation if it had been for the ash trees, for which we had an eight-week consultation; that matter was urgent. There was a really good reason for a short consultation on ash tree disease and four weeks would have been great; but we chose to go for eight weeks where there is an urgent need but four weeks to get rid of something that has been in existence since 1917. That makes no sense to me. The proposal is then brought here to Grand Committee where issues debated are supposed to be non-controversial, and we have a big row about whether the board should be abolished.
There is principled opposition and the noble Viscount should now tell us that he will withdraw his amendment and go away and reflect on it. He can then choose to bring it back on Report but it is not appropriate for the Grand Committee.
Viscount Younger of Leckie
My Lords, this has been a helpful and somewhat lengthy debate, which has included some passionate speeches from all sides of the Committee. I thank all noble Lords for their contributions.
I will clarify a couple of points. First, in relation to a point that was made by my noble friend Lord Plumb and led to a mini-debate concerning the figures in relation to retaining the Agricultural Wages Board, my noble friend is right to highlight the cost of the board. I have been advised that over recent years, the annual cost of running it has been around £180,000 and, for the ADHACs and the AWCs, the cost is around £20,000. That is just for the record. Secondly, the noble Lord, Lord Hunt, brought up the issue of rates of pay for farm managers. He quoted a rate of £14.10 per hour. I should like to clarify, and I hope he will agree, that he quoted the overtime rates, not the basic rates. The minimum hourly wage rate is £9.40 and the overtime rate is £14.10.
I will address directly some of the procedural issues that have been raised by noble Lords. The first issue was the question of whether the Agricultural Wages Board met the requirements of the Public Bodies Act procedures. This was raised by the noble Lord, Lord Whitty, my noble friend Lord Plumb, and the noble Lord, Lord Hunt of Kings Health. The Public Bodies Act is only one legislative route open to the Government to abolish the board. It is not the only route and it is perfectly open to the Government to decide upon another legislative option.
It would be politic to explain a little more about this. The Public Bodies Act created a specific set of arrangements for the reform of a wide range of public bodies by means of secondary legislation, which included the consent of Welsh Ministers, even where they exercised only minor functions. Welsh Ministers have specific, minor functions under agricultural wages legislation, for example in relation to the appointment of members of the Agricultural Wages Board, and ministerial consent was therefore needed to the proposal to abolish the board under the Public Bodies Act. The Welsh Government refused to give consent without powers to set agricultural wages and other terms and conditions being transferred to the Welsh Ministers. The Government could not agree to this for two main reasons. First, we regard this as a non-devolved matter relating to employment and, secondly, this would involve using the Public Bodies Act to extend devolution in a way that was never intended. I hope that that goes some way to explain why the Agricultural Wages Board stood out on its own.
Lord Howarth of Newport
Will the Minister also be good enough to explain to the Committee why it is acceptable for the Government to use the Bill to alter the effect of the Public Bodies Act, whereas it is not acceptable for the Opposition to use the Electoral Registration and Administration Bill to alter the effect of the Parliamentary Voting System and Constituencies Act?
Viscount Younger of Leckie
I note the point that the noble Lord is making but I was addressing purely the issues relating to the Agricultural Wages Board. I do not want to address or make a comparison with any other issue.
Lord Whitty
I am grateful to the Minister for confirming that one of the reasons for the change of tack by the Government is the Welsh situation but he is surely wrong in his remarks on devolution.
The Agricultural Wages Board has always been dealt with by the agriculture department. Well before political devolution, there was a separate devolution to the Scottish agriculture department. There is a separate arrangement in Northern Ireland. The employment issue falls to the United Kingdom. There is no difference in agriculture between Wales, Scotland and Northern Ireland, so why is the Minister prepared to accept that there should be devolution to Scotland and Northern Ireland, quite rightly, but to deny Welsh Ministers’ request, in the light of the decision in relation to England, to have a devolved body in Wales?
Viscount Younger of Leckie
My Lords, it is not for me to say it is only that. This is an historical fact, and I was just setting out the background to this. This is why the Agricultural Wages Board has remained separate. Now, in this Bill, we are looking to sort this out.
Lord Elis-Thomas
I apologise; I have been unable to follow the whole debate, as I have been sitting in the National Assembly in Cardiff.
Is the Minister aware of the statement issued yesterday by the Counsel General for Wales in which he proposes to refer the whole matter to the Supreme Court if the Minister persists with the current policy?
Viscount Younger of Leckie
I note the noble Lord’s comment. I was not aware of that.
The Deputy Chairman of Committees (Lord Faulkner of Worcester)
It might be for the convenience of the Committee if I remind the Committee that the Companion says:
“Members of the House who are taking part in a debate are expected to attend the greater part of the debate. It is considered discourteous for Members not to be present for the opening speeches, or at least the speech before and that following their own, and for the winding-up speeches”.
Viscount Younger of Leckie
I will move on to the issues that have been raised about the consultation period. Several noble Lords raised this issue, including the noble Lords, Lord Whitty, Lord Howarth of Newport and, indeed, Lord Knight of Weymouth.
The policy on the abolition of the AWB and related committees was first announced in July 2010, so there has been plenty of time for stakeholders and interested parties to make their views known. In particular, key stakeholders had the opportunity to do so during meetings of the Agricultural Wages Board and the Agricultural Wages Committees. The department felt that a four-week consultation period was proportionate and realistic, given the length of time that the policy had already been in the public domain. This is also in line with the Government’s new consultation principles.
In this respect I will address a point raised by the noble Lord, Lord Hunt, when he expressed concerns about those principles. The new principles allow for a tailored approach to the circumstances and needs of a particular case. Twelve weeks is not necessary in every case. The principles say that the timeframes for consultation should be “proportionate and realistic”. The department considers that the timeframe for this consultation was appropriate, given that the policy had been known for some time, as I explained a little earlier.
As mentioned, we also sent the consultation document to 13,000 bodies and held six meetings throughout the country to enable views to be heard. This very much involved Defra, which was also very much involved in disseminating information to those bodies and to many businesses to make them aware of the launch of the consultation.
Lord Howarth of Newport
I apologise for troubling the Minister again, but would he also explain, because I think people in Wales would be very interested to know his account of this, why one week’s consultation was good enough for Wales when four weeks was allowed for England?
Viscount Younger of Leckie
I have to say that it was news to me—I have heard it today for the first time—that there was one week’s consultation. It is my clear indication that it was not one week. It was a lot longer than that. I do hope that it was at least four weeks, but I will certainly get back to the noble Lord to clarify this, as it is important.
The noble Lord, Lord Whitty, in expressing concerns about the consultation responses, also stated that he wanted clarification. On the question of where the consultation responses are, all the responses are publicly available in the Defra library. Moreover, Defra officials specifically alerted the former Unite leader to the availability of the responses.
On the content of the responses, it is worth pointing out to noble Lords that there were 939 respondees, of which 345—37%—agreed with the proposal to abolish the Agricultural Wages Board; some 575—61%—were against, and 2% were “don’t knows”. The main point I want to make is that of the 575 against, 242 came from the same website.
Lord Hunt of Kings Heath
With the greatest respect, I imagine that some of those people represented about 157,000 workers, so it seems to me that that is not at all unreasonable.
Viscount Younger of Leckie
If the noble Lord prefers, I can get back to him—I will, indeed, get back to him—with more details concerning this response. I was purely expressing some facts concerning the response.
Lord Hunt of Kings Heath
With respect, it is not unusual for organisations to send notes to their members detailing changes that are going to be made and their implications. The noble Viscount seems to be saying that because these figures came through websites—I think he mentioned five websites—somehow they should be discounted. Surely that cannot be right. Is the Government’s new approach to consultation to make judgments about who they are going to listen to and to discount those responses that they do not like?
Viscount Younger of Leckie
With respect to the noble Lord, I did not say that I was discounting them. I was just producing some facts. However, it is strange that such a high number of responses came from the same website. I hope that that is a reasonable view to express. As I say, I shall be delighted to get back to the noble Lord with some clear figures and a response to that.
The noble Baroness, Lady Donaghy, raised the question of whether Northern Ireland or Scotland had been asked for a view on the abolition of the Agricultural Wages Board. I should clarify that the Agricultural Wages Board in Northern Ireland and the Agricultural Wages Board in Scotland constitute separate bodies and it is for their respective devolved Governments to take a view on their future.
The noble Lord, Lord Whitty, asked about the terms and conditions of farmers and their pay and sick pay under the current regime. Having two systems which may apply on the same site for the same organisation is not ideal. This measure obviously covers agricultural workers and will cover others who fall into the non-agricultural sector. Surely it is more confusing and difficult to operate such a system. As I said in my opening speech, farm businesses are increasingly diverse and carry out non-agricultural activities.
The noble Baroness, Lady Donaghy, asked why there was a difference between the first and second impact assessments. The first impact assessment was informed by independent research which compared the agricultural sector with the forestry and fisheries sector in order to assess the effect of the Agricultural Wages Board minimum wages. However, this did not allow for the fact that forestry is covered by an agricultural wages order. Since the consultation, the contractors have revised the analysis to correct this.
Lord Whitty
My Lords, does that mean that the Government stand by the second impact assessment? If it does, it undermines everything that has been said in favour of abolition of the wages board and the argument that that will make no difference, given that the second impact assessment says very clearly that over the next 10 years agricultural workers will lose £250 million worth of employment income. Let us be absolutely clear: if the Government, the noble Viscount’s department and Defra—the noble Lord, Lord De Mauley, is present—stand by the assessment, the removal of the Agricultural Wages Board will clearly lead to a serious reduction in wages in the agricultural sector.
Viscount Younger of Leckie
The intervention of the noble Lord allows me to move on to focus on the impact assessment. I do not recognise the figure that he has brought up. The impact will be between nought and £150 million.
Lord Whitty
To clarify, there is a range, but I am using a figure close to the best estimate which amounts to about £250 million.
Baroness Buscombe
My Lords, I am grateful to the Minister. I have been sitting here and slowly thinking to myself that I cannot continue to listen to the noble Lord, Lord Whitty, making this incredible, disingenuous argument. I am going to go back down memory lane briefly. I remember when the noble Lord, Lord Whitty, was Minister for Agriculture and we had the Burns report.
Lord Myners
I am grateful to the noble Baroness for giving way. The Chairman has already read from the guidance on participation in debates. The noble Baroness was not here at the beginning of the debate and in that circumstance—
Baroness Buscombe
Good.
I remember so well that when the noble Lord, Lord Whitty, was in government, the Burns report looked into the future of hunting. The report came back saying that if we lost hunting, the lives of a huge number of people in rural areas would be affected. They would lose their jobs and that would have a massive impact on the rural economy. I remember the noble Lord standing at the Dispatch Box saying “I do not like hunting. I am not interested in what the Burns report says. We are going to get rid of it anyway”. Here is the noble Lord, Lord Whitty, talking so much about the need for consultation as if he really cares what the result might be. This is all about dogma. What has been going on this afternoon has been vacuous and disingenuous, and I hope that the Minister will feel strong in his argument and ignore these disingenuous requests to remove the amendment.
Lord Whitty
I am quite happy to have another debate about hunting. I understand, however, that the Prime Minister is not prepared to pursue it. I have not seen the devastation in jobs in hunting since the hunting Act was passed, but let us put that to one side. All I was asking the Minister was whether he stood by his own department’s calculations of the effect on wages in the agricultural sector of abolishing the board. It is a straightforward question on which I would like a clear answer: if he does still accept it then everything we have been saying on this side is correct and there will be a serious detrimental effect. If he wishes to change it, however, I suggest he produces a different impact assessment before we reach Report.
Viscount Younger of Leckie
I will do my best to answer the noble Lord’s question. Our figures tell us that the impact assessment for new workers will be from nought to a worst-case scenario of £150 million. However, as I mentioned in my opening speech, there is no reason to suppose that the 60% of workers who are currently on a contract will not remain on their existing contract. Noble Lords will know that, if you are an employer, you cannot suddenly change or reduce a contract between two people.
The reality will depend on how farmers use the increased flexibility that will result from the abolition of the Agricultural Wages Board. Many workers are already paid above the agricultural minimum wage, so there is no reason why there should be a change. Moreover, the underlying labour market conditions suggest that workers will be in demand and farmers will need to offer competitive packages to attract and retain skilled and qualified staff. I am afraid that the evidence is against the noble Baroness, Lady Donaghy, who was claiming that the jobs would not be available and farm workers would be leaving the sector. I do not believe at all that that will be the case.
I am also grateful for the intervention from my noble friend Lord Plumb. It is encouraging to note his comments and all the efforts that he has been making in encouraging new workers into farming. I am also grateful for the intervention from my noble friend Lady Byford who, quite rightly, pointed out the importance of ensuring that there were some good working practices that will be retained within the agricultural sector.
The noble Lord, Lord Myners—who is now back in his place—spoke about the difference between the Low Pay Commission and the Agricultural Wages Board. This is exactly the point: there is no need for two different bodies both assessing low pay issues. That plays into our hands as to why we believe that it is right to abolish the Agricultural Wages Board.
Lord Myners
My Lords, the Minister made what I thought was a rather unnecessary remark about the fact that I was absent from the Committee for not more than five minutes—in a debate that has run for two and a half hours, and I was here for about an hour before that. I will not explain to noble Lords why I chose to leave the Room for five minutes, but for the Minister to make a point on that shows how desperate he is to keep the faith of his supporters.
On the subject of people leaving the Committee, the noble Lord, Lord Cameron of Dillington, who is no longer in his place, asserted his view that he did not think that the benefits would be passed on to supermarkets. I question that given that in their evidence to the consultation the supermarkets have been hugely supportive. One wonders why they are supportive of this proposal if they do not expect to benefit. If that is also the view of the Government, can the noble Viscount explain to us in very simple terms that if you have a transferred benefit here—taking £250 million out of the rural economy—where is that £250 million going? There has to be an equal and off-setting amount. Where does the Government believe the benefit will accrue?
Viscount Younger of Leckie
First, I apologise to the noble Lord. There was absolutely no derogatory comment intended.
I do not believe that the money will be taken out of the agricultural economy. The whole point of making this change and abolishing the Agricultural Wages Board is to create a more flexible environment and to enable farmers to recruit new workers.
Lord Myners
There is nothing in the Agricultural Wages Board that in any way prevents a farmer from paying more, as indeed the noble Earl explained to us. This is “flexibility” used as a euphemism. It is a flexibility that only moves in one direction. The Minister’s argument simply does not withstand any close and critical examination.
Viscount Younger of Leckie
I think I should repeat to the noble Lord that the Agricultural Wages Board has been in existence for 65 years. I realise that that is not necessarily a reason for changing but there are still some great anachronisms within the system. Secondly, part of the point is to release farmers from the administrative burden of the two-tier, dual system. So I stick by my view that this is long overdue and it is right that we should take this step.
The key priority for this Government is to encourage economic growth. The Government firmly believe that the abolition of the Agricultural Wages Board and the agricultural minimum wage regime is in the long-term interests of all those within the industry. It will enable the sector to meet the challenges of increasing domestic food production and help secure its long-term prosperity. The abolition of the related Agricultural Wages Committees and Agriculture Dwelling House Advisory Committees in England will also contribute to the Government’s public body reform programme and will remove a number of redundant bodies, as mentioned earlier. I hope that the Committee will accept the amendment.
The Deputy Chairman of Committees
The Question is that Amendment 28ZK be agreed to. As many are of that opinion will say “Content”.
The Deputy Chairman of Committees
My Lords, paragraph 8.103 of the Companion states:
“As divisions are not permitted in Grand Committee, decisions to alter the bill may only be made by unanimity. Thus when the Question is put, a single voice against an amendment causes the amendment to be negatived”.
I therefore declare this amendment negatived.
Lord Stevenson of Balmacara
My Lords, I shall speak also to Amendments 28ZKB, 28ZKC, 28ZKD and 28ZKE which are in my name and that of my noble friend Lady Hayter. I should make it clear that we on this side support the new bankruptcy regime and welcome what is set out in the Bill to try to make progress in this important area, but we would like to suggest some improvements. In so doing, I declare an interest as chair of StepChange, the leading debt advice charity.
We are concerned that the proposed changes to the bankruptcy process, wherein a court-based process is being replaced with an adjudicator, may lead to individuals and sole traders being declared bankrupt when there is actually an alternative debt solution which would be more appropriate for their situation and would have less severe consequences for the debtor. Such miscarriages of justice could lead to the debtor unnecessarily losing assets, including their house, or unnecessarily closing their business, and prevent them getting bank finance for 12 months or longer.
Particularly at this time, we need to be very careful about how the debt relief processes work in practice. Under the new process, as I understand it, a debtor will make an application to an adjudicator. The adjudicator will then determine the application based on two criteria: the jurisdiction criteria based on the debtor’s centre of main interest and whether the debtor is unable to pay their debts. Establishing the centre of main interest is important due to the recent development of bankruptcy tourism, where individuals from states with more onerous bankruptcy regimes, such as Germany or the Republic of Ireland, petition for bankruptcy in the UK in order to be discharged from their debts after 12 months. If the adjudicator is satisfied as to both criteria the order will be made. If the adjudicator is not satisfied that the criteria have been met, they cannot make the order.
The adjudicator will be able to request further information from the debtor, and if they receive information from third parties—for example, a spouse writing to the adjudicator to claim that the debtor was seeking to go bankrupt in order to avoid matrimonial claims—they would be able to decide whether or not to take this information into account. If the adjudicator is satisfied that the criteria have been met after receiving further information, the order will then be made. If the adjudicator rejects the application, the debtor is able to request a review of their file. If, after review, the application is once again rejected, the debtor can appeal to the court.
We need to consider the scale of the problems being faced by people experiencing unmanageable debt. We believe that some 6.2 million households are either in, or are close to having, significant debt problems. Bankruptcy is only one of three formal debt solutions, each of which involves the court, a licensed insolvency practitioner or the Civil Service equivalent. These include debt relief orders, individual voluntary arrangements and county court proceedings. However, many of StepChange’s clients prefer to reach a voluntary arrangement which we broker with their creditors and enter into a debt management plan under which they pay off their debts through us over a number of years. Last year, we returned some £300 million to creditors, and we are on target to counsel some 500,000 individuals this year.
At present, when a bankruptcy application is made to the court, either staff at the filing stage or the district judges or registrars at the hearing have an opportunity to point the debtor towards proper debt advice, and many discover that an alternative debt remedy is more appropriate for them. This may not only prevent miscarriages of justice, as I have already mentioned, but may also save the court, and particularly the official receiver, considerable unnecessary work.
However, we understand that under the new proposals, an adjudicator will not have the discretion to refer a debtor to seek advice and will have no choice but to process all eligible bankruptcy applications without considering whether an individual may be better off using an alternative debt solution.
The Government propose to deal with this concern in the new adjudication process by assuming that debtors will take independent debt advice before making their bankruptcy applications. However, in practice we know that many of our clients can stall over doing something about their debts for up to a year, until something such as illness or reduced earnings tips them over the edge, so to speak. We are therefore very concerned that the procedures to be introduced do not place sufficient stress on the need for debtors to seek independent free advice, with the consequence that the new system will be much less effective at preventing inappropriate bankruptcy applications.
Encouraging debtors to take appropriate debt advice prior to submitting an application will not necessarily ensure that they have all the information that they need in order to make an informed decision on whether bankruptcy is the best solution. Debtors contemplating bankruptcy are understandably under enormous financial and emotional stress and may be unaware of the sources of potential advice: my charity is the leading purveyor of free independent advice, but there are others, including Citizens Advice, and there are also fee-charging operations including, of course, insolvency practitioners.
Furthermore, while debtors may be aware of the gravity of bankruptcy and its implications, they may be unaware that they may qualify for an alternative debt remedy that would cost less, or be free, ensure that they maintain their homes and possessions, and have far less grave implications for their future relationship to credit.
I understand that in Scotland, where we operate as a separate charity, consideration is currently being given to making debt advice mandatory within the insolvency processes there, and I applaud that. I urge the Government to consider whether this would be a sensible step here. It would be possible to legislate to require a debtor to confirm that they have received independent expert advice before making their application. If that is too radical a step at this stage—and I accept that it may be—I urge the Government to think about emulating the Scottish Government to the extent of at least reviewing the whole debt arrangements system before too long. We have a major problem looming, as too many people are bumping along while prices rise, and with the spectre of a return to “normal” interest rates possibly the trigger for a whole range of new problems.
Amendments 28KA and 28KD give the adjudicator the opportunity to stay proceedings and work with debtors while they seek independent debt advice and enable debtors to withdraw their application during the 10-working day postponement period, for example if they are advised during that period that bankruptcy is not the most appropriate debt solution.
When he responds, will the Minister clarify whether the Government will consider ensuring that the online forms to be used in this new system will require debtors to confirm that they have sought appropriate debt advice from the independent and free debt advice charities? Will he also confirm whether there will be an exhortation for the debtor to work with the debt advice organisations such as StepChange, Citizens Advice and IPs to ensure that the advice suggested or required on the online forms captures the best possible options and language for the debtor? Will the Minister also confirm whether discussions are being held with the Scottish Government, particularly the Accountant in Bankruptcy up there whose scheme is very similar to that proposed?
Amendment 28ZKE reflects our concern that discretion for the adjudicator to seek guidance from the court has not been included in the Bill. If the adjudicator were given the discretion to ask the court for directions if they are not satisfied as to whether the criteria for making an order have been fulfilled, this could avoid the review and appeal process, as the court could provide an answer or guidance on complex issues, including cases where a petition may have been presented for an ulterior motive, such as to avoid matrimonial claims.
At present it is up to the debtor to appeal to the court if, for example, the adjudicator rejects their application, and in these circumstances the debtor may face the prospect of two fees—not a palatable prospect if the debtor is out of funds. If the adjudicator had the ability to seek guidance from the courts, we think that many cases may be resolved without the need for the debtor to apply to the court directly and incur additional fees.
Without the ability to seek guidance from the court, the process will also be unnecessarily prolonged and may expose the debtor to additional perils. In the interim period between the initial application for the order and the last resort of an appeal to court, there will be no moratorium from creditor action and debtors could still be pursued by their creditors, with all of the associated stress and anxiety that this can cause. In our view, the drawn-out process could be avoided if the adjudicator could seek guidance from the court in the first instance.
We understand that the Government have discussed the issue with insolvency practitioners and they take the view that it is more important to have a simple system shorn of subjectivity and to a large extent kept out of the courts. Those are admirable aspirations, but when he comes to respond, will the Minister honestly defend a situation where simplicity seems to be trumping individual rights, where difficult judgment calls are eschewed in place of a box-ticking process and where people’s rights to be heard in court are being threatened? I would be willing to meet the Minister and his team if that would be helpful because I hope that we can find accommodation on these matters. I beg to move.
Viscount Younger of Leckie
My Lords, the amendments seek to extend the role of the adjudicator introduced by Clause 63 of the Bill. Noble Lords will be aware that the reforms to the debtor-initiated bankruptcy process remove the order-making function from the court, and replace it with a new administrative process. This provides an opportunity to introduce a modern, electronic and more efficient application process, and was indeed first consulted on by the previous Government. A similar process has been successfully operated in Scotland since 2008, as the noble Lord, Lord Stevenson, has already mentioned. The adjudicator will be required to consider each application and decide on an objective basis whether or not the criteria for making a bankruptcy order are met. If they are, the adjudicator must make a bankruptcy order.
The first four of these amendments seek to impose a requirement on the adjudicator to consider whether bankruptcy is the right option for the applicant, and whether an alternative debt solution may be more appropriate. The proposal is that the adjudicator should have a discretion to hold off making a bankruptcy order for a period if he or she feels the debtor may benefit from taking further advice.
The amendments may be motivated by a power that the court presently has to refer a debtor who has presented a bankruptcy petition to an insolvency practitioner in a case where an individual voluntary arrangement may be a viable alternative to bankruptcy. I understand, however, that the courts very rarely make use of this power.
I reassure noble Lords that before making their bankruptcy application, applicants will be strongly encouraged to take independent debt advice to ensure that bankruptcy is really the right option for them. My officials will work with the Money Advice Service and providers within the debt advice sector to ensure that applicants have the information they need to make an informed decision. Furthermore, within the electronic application process itself, we propose to include a series of warnings to ensure that applicants are made fully aware of the serious implications of bankruptcy before they make their application. We will also ensure that the process flags up any alternative debt remedies that may better suit their circumstances.
The Government consider that these safeguards are sufficient to ensure that debtors are empowered to make an informed decision as to whether or not bankruptcy is the right option for them before they take the serious step of making a bankruptcy application. The Government believe that these amendments would unnecessarily complicate the process by requiring the adjudicator to exercise discretion on a case-by-case basis. That would increase administration costs with an impact on the application fee. It would also delay access to debt relief for the debtor, who would have elected for bankruptcy in full knowledge of their other options.
Amendment 28ZKE seeks to give the adjudicator power to apply to the court for directions in relation to any matter arising in connection with the bankruptcy application. The policy intention is to ensure that the system delivers better outcomes by focusing the court’s role and resources on matters of dispute that rightly require judicial intervention and expertise. The onus will be on the debtor to show that he or she meets the relevant criteria. However, the application process will be designed to help the debtor and to ensure that the adjudicator has all the information needed to reach a decision. The adjudicator will also be able to request such additional information from the debtor as he or she considers necessary for determining whether a bankruptcy order should be made.
The Government recognise that complex issues may arise in a small minority of cases, especially around the jurisdictional criteria and where the debtor’s centre of main interests is located in England and Wales. However, persons appointed as adjudicators will have the skills they need to do the job without the need for recourse to the court. It is acknowledged that the court still has a role to play. Where the adjudicator refuses to make a bankruptcy order because the criteria are not met, the debtor will have the right to appeal to the court. That provides a route to court in those cases where it is needed. The court will also continue to determine creditor-initiated bankruptcy petitions, which are more likely to be complex and contentious.
For these reasons, the Government consider that this amendment would confer an unnecessary discretionary power on the adjudicator. In the light of these reassurances about the application process and the recourse to court for debtors, I hope that the noble Lord will agree to withdraw the amendment.
Lord Stevenson of Balmacara
I thank the Minister for that response. I sense within what he has said that he shares some of my aims in tabling these amendments, and I welcome that. However, I am still a bit perplexed. If you are prepared to go down the route of ensuring that those responsible in these processes flag up the options that are available to people—as I tried to explain in my opening remarks, there are many people for whom bankruptcy is the wrong solution; in the rather overused phrase, it is the nuclear option—and you are going to ensure that appropriate warnings are put on to the application forms, we are very close indeed on this point. It therefore boils down to a question of whether there is a bit more discretion in the system than perhaps the Minister is prepared to admit. I find that puzzling.
I tried to explain in my opening remarks that there is an awful gap for a debtor who is attempting to resolve a crisis because the only two options are to trust an adjudicator, and if the decision goes against the debtor, to find, finance and pay fees for an appeal to the court. As the noble Viscount has said, there are areas where the court will be better placed to make these decisions. The other point he made was the need to make sure that, in the first instance, there is sufficient discretion in the appointment of adjudicators who have the sensibility to make sure that people are involved. The noble Viscount has hinted that further discussions may take place between his officials and the appropriate authorities. I would urge that they involve the main bodies that are actually involved in direct dealing with those who have debt problems and not with the Money Advice Service. Obviously it will have an interest in this, but I think we need to speak to the experts in this matter. Perhaps we could have a side exchange on how those discussions go and whether the right people are being consulted. I would then be less concerned about them.
We may have to come back to this issue because to me it feels too tight, but perhaps further experience will be sufficient. On that basis, I shall withdraw the amendment.
“ In section 293 (summoning of meeting to appoint first trustee), in subsections (2) and (3) for “court” substitute “prescribed person”.
In section 295 (failure of meeting to appoint trustee), in subsection (3) for “court” substitute “prescribed person”.”
Viscount Younger of Leckie
My Lords, these amendments make minor and technical changes to the Insolvency Act 1986 and relate to the reforms to the debtor bankruptcy petition process introduced by Clause 63. The reforms will remove the existing requirement for the indebted individual to present a bankruptcy petition to court and replace it with a new administrative process. Presently, certain statutory notices are required to be filed at court during the course of a bankruptcy. Most of these requirements are presently set out in the Insolvency Rules. However, a small number of requirements are contained in the Insolvency Act and are the subject of these amendments.
The proposed amendments would ensure that Ministers, in consultation with stakeholders, are able to modernise and make more efficient all of the filing and document inspection processes governing both debtor and creditor-initiated bankruptcies without the need to amend the Act in the foreseeable future. It is anticipated that, where the bankruptcy is commenced by way of the debtor making an application to the adjudicator, documents generated will not necessarily be routinely filed at court. While the Government have no intention at present to change the current policy of filing notices at court in relation to creditor-initiated bankruptcies, it is possible that in the future the Government may be minded to extend some or all of the filing efficiencies introduced in relation to debtor-initiated bankruptcies to creditor-initiated bankruptcies.
The strong policy preference is that such detailed procedural requirements, including those relating to filing, should be in the rules and not in the Act. This is in line with a wider government agenda to consider the overall structure of insolvency legislation with a view to ensuring consistency in what is contained within the primary and secondary legislation. One of our aims is to remove detailed prescriptive requirements from the primary legislation wherever possible. The amendments also make other minor and technical changes that are consequential to the reform of the debtor petition process. I beg to move.
Lord Stevenson of Balmacara
My Lords, I have listened carefully to the Minister. I find that these proposals are in keeping with the general approach that has been taken and I have no particular objection to them. I mentioned in my contribution on the earlier amendments that I was much taken by the experience in Scotland; I was trying to suggest that there are lessons to be learnt from there. I make this point, which I think would be worth reflecting on. The new bankruptcy Bill that is about to go through the Scottish Parliament, which I am sure officials are well briefed about, seems to take as its starting point a slightly different perspective to those with debt problems from the one that we are taking in England and Wales. I slightly regret that. I am not overstating it when I say that there is an ambition north of the border—is there not always an ambition north of the border?—to create what is called there, possibly in correspondence rather than in the main line, a financial health service. Perhaps the Minister could reflect on whether there is some element of that in what is being proposed in the totality of the amendments that we have been considering today.
The point that I am driving at is that, if we focus only on the processes when people are already facing imminent bankruptcy or worse, we are not picking up the sensibility that I think is infusing the thinking by the Accountant in Bankruptcy and in the Scottish Parliament on these matters, which is that far greater attention should be placed on the role for public involvement in the borrowing and lending processes that affect individuals. Too many people find it very easy to borrow and extremely hard to save. That balance is completely wrong. We should have a much more balanced approach to how these things operate and how we regulate in a space within which people extend credit in order to provide the sort of services that they wish to use during their lives but at the same time acquire debts that have to be serviced and eventually repaid.
There is a bigger and better conversation to be had around whether the 19th-century and 20th-century notions of debt are as appropriate as they should be in the 21st century to the way in which people operate. At one level—I do not want to extend this debate, but I think that this is an important point to put on the record—there are many instances where we see behaviour in the marketplace that is counterintuitive and absurd. I am thinking particularly of payday lenders. The problems relate to the flow of credit to those who need it and the pressures under which they operate. The fact that people are prepared to take out these ridiculous loans at absurd interest rates and on impossible repayment terms is not a reflection of iniquity on the part of the lenders; it is a reflection of something that is going on in society. We are not tapping into that in the proposals that we are hearing today. Yes, it is sensible to take away the courts’ role as a primary source for all these bankruptcy applications but only, I would argue, if we are also aware of and alert to the other ways in which people can be assessed for indebtedness and helped to find an appropriate way forward. On that basis, I find this general approach right but possibly lacking context. I wonder whether, in his closing remarks, the Minister could make a few comments on that area.
Viscount Younger of Leckie
I listened carefully to the noble Lord, Lord Stevenson, and I am very grateful to him for his full response. I very much take note of the issues that he raised concerning the need to provide better help to those who unfortunately get into debt. I think that the best thing to do is to follow up his suggestion to take this further in discussion outside this Committee.
“ In section 298 (removal of trustee and vacation of office), in subsections (7) and (8) for “court” substitute “prescribed person”.
(1) Section 299 (release of trustee) is amended as follows.
(2) In subsection (1)(a) for “to the court” substitute “under this paragraph to the prescribed person”.
(3) In subsection (3)(a) for “court” substitute “prescribed person”.”
“(1) Section 415 (fees orders) is amended as follows.
(2) In subsection (1)—
(a) after paragraph (a) omit “and”, and(b) at the end of paragraph (b) insert “and(c) the performance by an adjudicator of functions under Part 9 of this Act,”.(3) After”
““24ZA Provision requiring adjudicators—
(a) to keep files and other records relating to bankruptcy applications and bankruptcies resulting from bankruptcy applications,(b) to make files and records available for inspection by persons of a prescribed description, and(c) to provide files and records, or copies of them, to persons of a prescribed description.24ZB Provision requiring an adjudicator to make returns to the Secretary of State of the adjudicator’s business under Part 9 of this Act.”
“24B Provision requiring a person to whom notice is given under section 293(2), 295(3), 298(7) or (8) or section 299(1)(a) or (3)(a)—
(a) to keep files and other records of notices given under the section in question, and(b) to make files and records available for inspection by persons of a prescribed description.””
Lord Lucas
“Ownership of licences to copyright
(1) Any natural person who acquires, for value and for his personal use only, the right to use a copyright may, for value or otherwise, transfer that right to any other person.
(2) Any terms in any contract that purport to forbid, place restrictions on or require payment for a transfer under subsection (1) shall be null and void.
(3) Any person who in any way controls the use of a copyright must do all things necessary, without undue delay and without recompense, to effect a transfer under subsection (1) above.”
Lord Lucas
My Lords, in moving the amendment, I wish to speak also to Amendment 28B.
Since I tabled these amendments, we have had a Christmas present from the ministry. On 20 December, the Secretary of State was kind enough to announce a package of intentions to reform copyright which entirely supersedes my Amendment 28B. Therefore, I will not trouble the Committee by addressing that because clearly we will see this in a proper and thought through form when we come to the Bill that will follow the announcements made by the Secretary of State. However, we have a small cameo performance on copyright now before we go to bed. I would be grateful if the Minister could confirm that the 28th of this month will be the next day in Committee, since clearly this stage of the Bill is now going to go into 10 sittings. If there is any suggestion that there will be a day in between, will we all receive an e-mail notification rather than having to spot that something has changed on the Order Paper?
It seems to me that copyright is aptly described by Macaulay. A lot of people speak as if copyright is a god-given possession of creative people. It is not; it is a deal done between those who consume copyright material—I both produce and consume copyright material—and those who produce it. In order that it should be produced, those who consume are prepared to let the copyright owners have a limited monopoly on it, but that monopoly is not without terms. It is given in order that it should be available for consumption. The way in which people want to consume copyright material is therefore an important part of negotiating and renegotiating the bargain between users and producers of copyright material.
My firm view, which, to judge from his 20 December announcements, is shared by the Secretary of State, is that we should look at copyright as a means of increasing national wealth, not just of producing a nice little rose garden to enable creative people to live comfortably and have everything exactly the way that they want it. It is a bargain between two sides. It is an agreement to use something that is essentially an evil—a monopoly—in order to enable something good to happen. My view, like that of the Secretary of State, which is covered in Amendment 28B, is that we must from time to time look at the way in which copyright functions in this country and ask whether it is serving the interests of users as well as those of the people who create it. In the case of fair use, quite clearly the rules had begun to fall well short of the way in which people wanted to use copyright material. We all own a reasonable variety of devices. If we buy a copy of Beethoven’s ninth symphony by the London Symphony Orchestra, we ought to be able to listen to it on various devices; we do not want to have to buy separate copies for separate devices. Therefore, we must make it possible for users to do that because that is the way that users want to consume material and that is part of the modern bargain.
Amendment 28A covers something that the Secretary of State has not touched on but which others will be aware of. In the days of books—and long may they continue—when you bought a book, you owned it. You could pass it on to other people, you could sell it second-hand, you could leave it in your will—it was a possession. Now if you buy a book for use on your Kindle it remains the property of Amazon, which can remove it at any time—and does. Amazon strips people of their whole libraries or removes individual books if something has gone wrong with the licensing. You do not own a book; you just have the right to consume it for a while. That is a fundamentally undesirable position when it comes to the relationship between the creator and the user.
Something that is for personal consumption ought to be a personal possession; it ought to be something that we can pass on to other people. We should not allow the position to persist where the balance has been shifted. We have allowed the change in technology to change the balance between the old regime that existed in the case of books, of ownership as a result of payment to one of leasing as a result of payment. We should encourage people to have libraries and pass on intellectual works they have created to other people. That is the right balance between users and creatives. I want to restore the balance in the case of modern technology to where it was in the case of the old technology. Although I know I will not achieve anything this time with this amendment, I hope we will see something, if not from this Secretary of State then a future one. It is certainly a matter I will raise when we next debate this Bill. I beg to move.
Lord Clement-Jones
My Lords, it would be a shame not to savour the final quarter-hour of Committee today—although I have probably learnt more about agriculture than I ever wished to. I see that the noble Lord, Lord Whitty, is still here; he is clearly incredibly versatile in all these matters. Seeing him and the noble Lord, Lord Lucas, I am afraid that I am reminded of the passage of the Digital Economy Bill, which may or may not be a good thing. As we know from that, the noble Lord, Lord Lucas, is never knowingly underprovocative, particularly on the question of intellectual property rights, and I am not going to enter the lists with him on the issue of the format-shifting exception that was the subject of the Christmas present he mentioned.
Amendment 28A is an incredibly sweeping amendment that would have a massive impact on the cloud computing industry in the UK, which is forecast to grow from something like £2 billion to £6 billion. It would have an incredibly damaging effect, which makes it highly undesirable for various commercial reasons. Quite frankly, it also happens to be in contravention of the existing EU directive on computer software, which gives the exclusive rights to copyright owners in those circumstances. Of course, there are issues about the ownership of digital content, but this is not the way to deal with them. There are issues about who owns what you have on your iPad or tablet from other manufacturers, but this is an incredibly sweeping way to do it. In the way the amendment is phrased, I doubt whether it will cure the issue by itself.
Baroness Buscombe
My Lords, I rise to resist the amendment of my noble friend Lord Lucas and to support what my noble friend Lord Clement-Jones said. My noble friend Lord Lucas’s argument in relation to Amendment 28A; that if someone has a book they should be allowed to own it, enjoy it and pass it on to others sounds, emotionally, like a good thing. Indeed, I have done that on many occasions among my family and friends. But passing one book among one or two friends is a million miles from what is now possible because of the speed of technology. Because of the digital world we inhabit, the whole of the creative being of that book can be out in the ether and transmitted globally within moments. The creative right is all but destroyed rather than shared in a small and special way. While I entirely understand the emotion behind the idea that we should continue to feel that we can share something we really enjoy, it is neither wise nor sensible to do that in this world because it will deter creators from creating more wonderful books. That is the tragedy of this. It is a perverse consequence of technology.
Lord Stevenson of Balmacara
My Lords, I do not wish to detain the Committee, but I wish to thank the noble Lord for his introductory comments and reflect on two points. First, a number of the issues he raises will come up in other amendments and I hope that he will share his wisdom on those occasions as well. Secondly, I must disappoint him in one respect. He suggested that part of what he wanted to say was covered by the Christmas present provided by the additional copyright exceptions and other things that were coming forward and that there might be an opportunity to discuss those in a separate Bill. That will not happen because the Government are, at the moment, choosing to implement those proposals by secondary legislation, bundled in, as the note says, “as few SIs as possible”.
Unless we get a late Christmas present from the Minister, we will have to oppose that because there are very large issues within what has been proposed. Not all of them are unwelcome and we would probably want to get behind most of them. But the way in which it has been done leaves a gap in the expectation outside that there should be a lot of discussion about these things. As has just been said, they affect the very heart of what we are trying to say around our creative economy, how people create and how things are consumed. If we do not get that right, there will be a wave of concern outside. I therefore lay down a small elephant trap for the Minister to fall into then leap out of with one bound later on when we reach that point in the Bill.
Viscount Younger of Leckie
My Lords, it is fair to say that, as a Scotsman, I do not do Christmas presents after Christmas. Nevertheless, I am grateful to my noble friend Lord Lucas for initiating these amendments. Before I continue, I cannot yet confirm the dates for the extended Committee work, but we will make sure that noble Lords hear in good time.
The amendments aim to allow consumers to do more with copyright materials that they have already bought. Amendment 28A seeks to ensure that personal licenses to use copyright can be resold or passed on to another person. This would apply, for example, to those licences that accompany e-books or computer software. This is an important area and one of which the Government are keenly aware. However, the law in this area is still developing. The extent to which resale of licences is already allowed under European law is not yet clear. The cases that have been considered have dealt with specific limited circumstances. I note the comment from my noble friend Lord Clement-Jones who described the proposal as incredibly sweeping. Perhaps it is not surprising that I would say that there should be careful consideration before action is taken.
Lord Lucas
My Lords, I am grateful to my noble friend for his reply, and less grateful to my noble friends for their interventions.
To my noble friend Lord Clement-Jones, I will say—as I will likely say on future occasions in this Bill—phooey. One of the effects of cloud computing and the fact that something is not fundamentally located on an individual device makes the whole business of regaining ownership much easier. No longer does one have to deal with something that is passed from device to device and copied into a torrent stream that suddenly goes illegal and cannot be kept track of. In the case of iTunes, it is one enormous great cloud computing lump, and transferring ownership is an extremely easy thing to do if one bothers to write a few lines of code. Technology is moving on and is making the transfer of ownership much easier than it was under the old ways of doing things. I expect that, given proper consideration and thought, this will be quite easy to implement in a few years’ time. For now, I beg leave to withdraw the amendment.
House of Lords
(11 years, 10 months ago)
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Property: Leasehold Valuation Tribunal
(11 years, 10 months ago)
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Baroness Gardner of Parkes
To ask Her Majesty’s Government whether they will review the workings of the leasehold valuation tribunal.
Baroness Gardner of Parkes
My Lords, in asking the Question in my name on the Order Paper, I declare that my interest is recorded in the register.
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, we have no plans to review the working of the leasehold valuation tribunal. However, later this year, the tribunal will transfer into the newly established property chamber in the First-tier Tribunal, in line with our recently published administrative justice strategic work programme. In addition to improved deployment of judicial resources, the tribunal will operate under new procedural rules, which will continue to ensure that all parties will have greater access to an efficient, proportionate and fairer system of justice.
Baroness Gardner of Parkes
Is the Minister aware that in the Housing Act 1996, when the leasehold valuation tribunal was set up, the aim was to make it within the reach of every leaseholder to be able, for the amount of £500, to bring his case to the tribunal? Is he aware that now many landlords—whether they win or lose, even if they have no hope of costs—are charging their heavy legal expenses back through the management schemes in the blocks of flats?
Lord McNally
I pay tribute to the noble Baroness’s long campaign on this issue. She was an active participant in the Bill that became the 1996 Act. She is absolutely correct that the right of the managing agent to claw back costs of litigation can be written into leases. This can be countermanded by an application to the court under Section 20C of the Landlord and Tenant Act 1985, but that has to be a proactive action by the leaseholder. We are looking at ways to make leaseholders more aware that, if such a clause is written into their lease, they have this power to take action to have it set aside by the tribunal.
NHS: Clinical Commissioning Groups
(11 years, 10 months ago)
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Lord Hunt of Kings Heath
To ask Her Majesty’s Government why the NHS Commissioning Board is discontinuing the poverty element in the funding formula for allocation to clinical commissioning groups.
Lord Hunt of Kings Heath
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare my interests on the register.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, I can reassure the noble Lord that the board has not discontinued the poverty element of the funding formula. The board was concerned that while the formula provides an accurate model of healthcare need as currently met, if implemented it would target resources away from those areas with the worst health outcomes. It has therefore decided to give all clinical commissioning groups the same growth while launching a fundamental review of allocations.
Lord Hunt of Kings Heath
My Lords, I am grateful to the noble Earl for that explanation and understand that a flat-rate increase is to be given next year on top of the existing formula. Will he assure me that if the national Commissioning Board, after this review, decides not to go down the route that the previous Secretary of State, Mr Lansley, wanted this review to take—namely, to take money away from the poorer areas and give it to the well off areas—it will see no interference whatever from Ministers in relation to that decision?
Earl Howe
My Lords, that is a very important principle. It is one of the reasons why we felt that the NHS Commissioning Board should be responsible for the allocation of resources to CCGs and not Ministers, to avoid any perception of party-political interference. However, the Government’s mandate to the board makes clear that we would expect the board to place equal access for equal need at the heart of its approach to allocations. That is why ACRA has been charged with developing formulae independently to support the decision that the board takes.
Baroness Jolly
My Lords, the first rule of funding is that recipients are never happy with their allocation. Given that, will the Minister assure the House that, with new configurations that we have with public health and CCGs, the model used will regularly be reviewed to ensure that it remains fit for purpose?
Earl Howe
Yes, my Lords. As I have indicated, as regards the NHS allocations, the board is clear that the model needs to be reviewed. That does not necessarily mean that it will need to change; the board will have to keep an open mind about that. Clearly, the board was not happy that the formula as currently constructed best met future needs. As regards public health, I think that we are in a better place. As my noble friend will know, the allocations were announced recently and they provide for considerable real-terms increases everywhere around the country.
Lord Mawhinney
My Lords, if the Commissioning Board decides to change the present formula, will the new proposal be subject to public consultation before it is implemented?
Earl Howe
My Lords, ACRA, the independent committee, will take advice from all relevant quarters. I am sure that the advice it receives will be taken on board. I do not think that there will be a public consultation as such but, if I am wrong about that, I will write to my noble friend.
Lord Rea
Will the noble Earl reassure us that this new allocation committee will take fully into account the fact that poor people have worse health and, therefore, in an equitable system, it will cost more to include them in the full services that the NHS can provide? Will he reassure us that that will be taken adequately into account and that proper measurements will be made of the health differences between social classes?
Earl Howe
I can give the noble Lord that reassurance. ACRA is not a new committee; it has been long-established, and was a fundamental part of the previous Administration’s approach to funding allocations. I can say to the noble Lord that, by using diagnosis information, the formula that has been adopted for CCGs directly picks up a great deal of the increased prevalence of ill health due to deprivation. It also takes account of the proportion of the population in social housing and in semi-routine occupations, and the number of DLA claimants, which is closely related to deprivation.
Baroness Farrington of Ribbleton
Will the Minister assure the House that, if the board is able to find a formula more reflective of local need in terms of poverty and deprivation, the Government will look at it? They appear not to take such factors properly into account when looking at the revenue support grant which provides services for people in poverty. I declare an interest as someone who lives in Preston, Lancashire, whose needs are being met with a government cut. I am sure that the noble Earl would not approve of that.
Earl Howe
I am pleased to say to the noble Baroness that there has been no cut at all in the allocations to clinical commissioning groups. Indeed, there is a real-terms increase everywhere in the country. I can also reassure her that this will not be a matter for Ministers; it will be decided independently by ACRA advising the board and the board taking the decision.
Lord Cormack
My Lords, I congratulate my noble friend on becoming a privy counsellor.
Lord Cormack
It is a very well-deserved honour. Does he have regular meetings with the chairman of the board, and what plans he has for that?
Earl Howe
I am very grateful to my noble friend. I have meetings from time to time with the chairman of the NHS Commissioning Board, as does my right honourable friend the Secretary of State. I also meet regularly with the chief executive of the Commissioning Board. It is important that there is that interaction between Ministers and the board if there is to be proper accountability.
Lord Laming
Will the Minister say whether poverty was the only element that was removed and, if so, why was this singled out?
Earl Howe
Poverty was not removed. As I hope I have outlined, there are various criteria reflecting deprivation which are most certainly relevant to the fair allocation of resources. Age is clearly another factor, because it would be difficult to envisage an allocation formula that did not take it into account; it is the key factor in determining an individual’s need for healthcare. That is not to say that other factors such as deprivation should not continue to be considered.
Baroness Williams of Crosby
I would add congratulations from these Benches to the noble Earl on his very well-deserved honour which reflects the immense contribution he has made to this House. On the issue of poverty, is the existence of traditional industrial diseases, such as emphysema in mining areas, taken into account in the allocations that continue to be made between CCGs?
Earl Howe
I am very grateful to my noble friend for her kind remarks. The information I have in my brief is as I have stated, in that the indicators reflecting deprivation are quite broad. However, it is for ACRA, the independent committee, to review those indicators to see that the measures are representative and accurate. I am grateful to my noble friend for pointing us towards some other indicators which could be relevant, and I shall make sure that her ideas are passed to the appropriate quarters.
Lord Reid of Cardowan
My Lords, when the Minister says that the decisions on these allocations are, of course, not taken by Ministers, that is correct. However, can he confirm that it is equally correct that the criteria by which those decisions are made are influenced, judged and promoted by Ministers? Is not the most important thing that he said today that the primary determinant of this should be need? Here I declare an interest, because I had to address this when I was Secretary of State for Health. During the period 1979 to 1997, there was almost an indirect, inverse relationship between increases in funding for areas and their social and health deprivation. I am sure that had nothing to do with the coincidence of voting patterns in those areas of social and health deprivation, but it would be reassuring if he could tell us that that is not likely to happen during the term of this Government.
Earl Howe
My Lords, we are determined that it should not happen. I am as aware as the noble Lord of the perception of party-political bias, and it is highly undesirable that there should be such a perception. That is why, in the mandate to the NHS Commissioning Board, we have stated simply that we believe that the right basis for allocating resources is to place equal access for equal need for healthcare services at the heart of whatever formula the board decides to follow.
Lord Hunt of Kings Heath
My Lords, perhaps I may come back to that very important point. The fact is that the advisory committee, presumably following guidance from Ministers and officials, came up with a formula that would have taken money from poorer areas and allocated it to richer ones. That is why the national Commissioning Board decided not to accept it and to go for an across-the-board increase. In the noble Earl’s discussions on the mandate, will he ensure that the Commissioning Board is enabled to come to its own view on these decisions?
Earl Howe
Yes, my Lords. In this case, the board concluded that the formula proposed by ACRA accurately predicted the future spending requirements of CCGs, but it was concerned that the use of the formula on its own to redistribute funding would predominantly have resulted in higher levels of growth for areas that already have the best health outcomes compared with those with the worst outcomes. In other words, the formula on its own would have disadvantaged precisely the areas that the noble Lord is most concerned about. On the face of it, this would appear to be inconsistent with the board’s purpose, which is to improve health outcomes for all patients and citizens, and to reduce inequalities, which is a key aspect of the mandate.
Lord Brooke of Alverthorpe
My Lords, as patients are to be at the heart of the new NHS from April, will it be the Commissioning Board or the Government who are responsible for advising patients throughout the country of their rights and responsibilities?
Earl Howe
My Lords, the NHS constitution is currently under revision. It is a task for the Department of Health to take forward but, as the noble Lord will know, in the mandate and indeed in the Health and Social Care Act the Commissioning Board is charged with upholding and promoting the NHS constitution. The process of updating the constitution is, of course, subject to full public consultation.
Education: School Leavers
(11 years, 10 months ago)
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Baroness Massey of Darwen
To ask Her Majesty’s Government what assessment they have made of the statement by the Confederation of British Industry that pupils leaving school should be “rounded” and “grounded”; and, what steps they plan to take to ensure education policies support that objective.
Baroness Garden of Frognal
My Lords, the Government welcome the CBI’s report. We share the view that all pupils should leave school prepared for the next stage of their life in education or work. Our reforms to qualifications, the review of the national curriculum, the raising of the participation age and the introduction of a pupil premium for disadvantaged pupils all testify to this. The academies and free schools programmes give head teachers the freedom they need to achieve the CBI’s vision.
Baroness Massey of Darwen
I thank the noble Baroness for that response but does she believe that the Government understand the importance of pupils developing emotional and social skills and that such skills enhance academic learning? I cannot believe that they do understand that because we have now been waiting for well over a year for a review of the curriculum, as well as for a review of personal, social and health education in schools, which has not appeared. Can she say where this review has got to?
Baroness Garden of Frognal
My Lords, I pay tribute to the noble Baroness’s expertise in this subject and to her support for PSHE, which I know is widely shared around this Chamber. It is true that we have not yet announced the outcomes from the PHSE review, which has been extended to take account of the review of the national curriculum. Perhaps I may reassure the noble Baroness by saying that, in its latest report, Ofsted said that 75% of the schools it visited were providing good or outstanding PSHE education. Therefore, although it is not statutory, that figure is encouraging. However, we shall of course be monitoring the situation.
Baroness Brinton
My Lords, we are constantly told that we are short of engineers in this country. CBI director-general John Cridland has said:
“Businesses have traditionally focused on education at 14 plus, but it’s clear we need to tackle problems earlier, instead of applying a sticking plaster later on”.
What are the Government doing to encourage exciting and vibrant maths and science teaching at primary schools, particularly those with lower attainment levels?
Baroness Garden of Frognal
My noble friend picks up a very important point from the report, and it was encouraging to see that now almost one in five maths graduates is choosing to go into teaching. Among the initiatives going on, I highlight one under which eight universities are delivering the two-year master’s-level mathematic specialist teacher programmes, which aim to improve the practice and efficiency of primary maths teaching by upskilling existing teachers who in turn train their colleagues. This year, our funding for that programme alone amounts to £2 million.
Lord Northbourne
My Lords, I wish to ask the noble Baroness whether the Government have a policy on helping young people in secondary schools to learn about and to acquire what used to be called the soft skills. By those, I mean interpersonal skills, including relationships skills, self-confidence, leadership, teamwork, communication skills and many others, all of which are very important both in the workplace and in raising a family.
Baroness Garden of Frognal
Indeed, it is vital that young people come out of school with the soft skills which the noble Lord has highlighted. As far as parenting skills and others are concerned, there are of course different programmes, including the PSHE programme which so many schools are following. How schools address these matters specifically is for each school to determine locally.
Lord Howarth of Newport
My Lords, does the noble Baroness accept that if pupils are to leave schools rounded, they will have studied and practised the arts within the reformed curriculum? Imaginative capacities are increasingly important, both for the employability of individuals and for the competitiveness of businesses.
Baroness Garden of Frognal
Of course the arts are of particular importance. We touched on this in Questions and debates earlier this week. The Government fully support this, and there are various funding streams going into support of the arts. The issue seems to be that they do not appear in the EBacc, but of course not all schools do the EBacc. In any event, there will always be 20% to 30% of the timetable for such things as creative subjects, which are so vital to individuals and the country.
Baroness Heyhoe Flint
My Lords, is the Minister able to confirm that any future Statements on the school curriculum, including the English Baccalaureate, will include a greater emphasis on the provision of physical education? The current derisory agreement is that there will be a minimum of one hour per week of physical education. The CBI’s aspirations that school leavers be grounded and rounded may otherwise have different connotations when one realises the serious obesity problems with school beginners rather than school leavers.
Baroness Garden of Frognal
My noble friend makes her point in her own inimitable way. Of course, PE is an essential component of the school timetable. The amount of time that is spent on it is, again, a matter for schools to determine for their pupils and circumstances. However, particularly following on from the tremendous Olympic and Paralympic Games this summer, we would not wish to see the initiative for sport lost.
Baroness Hughes of Stretford
My Lords, research undertaken by MORI for the Department for Education itself has shown that courses in the creative arts, physical education, design and technology and business studies are now disappearing from schools as a result of the new, narrow EBacc performance measure by which schools will be judged. Will the Government now accept the CBI’s proposal that the EBacc be suspended so that the impact on schools can be properly assessed, before these cuts in courses become irreversible?
Baroness Garden of Frognal
My Lords, the EBacc has already had some very beneficial effects on children from disadvantaged backgrounds; we have seen their levels of attainment improving. The EBacc is not for everybody, and there will be alternative provision. We will certainly be monitoring the impact on the arts, sport, and all those other subject areas which are so important within the educational programme.
The Lord Bishop of Derby
My Lords, in terms of the roundedness of arts, sport and faith studies, the key issue is: how can the experiences and studies of pupils be recorded and monitored so that they can carry with them a proper record of their achievements and learning in those areas?
Baroness Garden of Frognal
The right reverend Prelate makes an important point. Of course, there will be recording of the sorts of achievements that young people make at their schools that are not subject to formalised end testing. I agree with him and, indeed, with the other questions that we have heard that sometimes those are the most important parts of a young person’s education. It is not necessarily the end exams that tend to show how people can progress; sometimes those personal skills are far more important for a successful and rewarding life.
EU: UK’s National and Trade Interests
(11 years, 10 months ago)
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Lord Renton of Mount Harry
To ask Her Majesty’s Government what assessment they have made of the impact on the United Kingdom’s national and trade interests of disengagement from the European Union.
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi)
My Lords, membership of the European Union is in the UK national interest. We continue to engage actively and constructively with our European partners and play a leading role in a wide range of EU business. The UK benefits from membership of the EU, including from the unrestricted access for UK businesses to a single market of around 500 million customers, which was worth £11 trillion in 2011, and from securing greater market access for the UK at a global level when, for example, it plays a leading role in EU free trade agreement negotiations with third party nations.
Lord Renton of Mount Harry
My Lords, I thank my noble friend very much for those very interesting statistics but could I take matters just a little bit further? Does she agree that it is absolutely essential for us as a trading nation to keep our alliances, partnerships and businesses throughout the European Union? Against that background, does it not follow that we should not be seen as a reluctant player in Europe, constantly looking for the way out and not the way forward? Could she make that point sometimes to some of our colleagues?
Baroness Warsi
I could not have thought of a better week for such a Question from my noble friend because it gives me an opportunity to say that this coalition Government are committed to playing an active and leading role in the EU, while advancing the UK’s national interests and protecting its sovereignty. Membership of the EU is in the UK’s national interests and it is what this coalition Government believe, but the EU needs to reform to meet the challenges of competitiveness. It needs a stable eurozone and greater democratic legitimacy. It is to that end that the Prime Minister will be making a speech later this week.
Lord Tomlinson
My Lords, we heard clearly from the noble Baroness about the benefits of being in a position to exploit our membership of the single market. Does she agree with me that it would be inappropriate at present to do anything to disturb that, particularly as sterling is currently devaluing against the much criticised euro, which is improving our terms of trade with Europe and giving us greater potential competitive advantage there?
Baroness Warsi
The Government believe that we can have a better Europe and that Europe can be reformed with a view to increasing those real benefits that come from the European Union.
Baroness Williams of Crosby
My Lords, when the Prime Minister speaks later this week, will he draw attention, as the Minister has done, to the significance of the single market, which was strongly supported by Mrs Thatcher, to the insistence of many of our closest allies, such as the United States and the leading countries of the Commonwealth, that our influence within the EU is vital to the position of the West in the world’s global discussions, and to some of the outstanding developments in global fields, for example, on climate change and not least on organised crime, which have been successful examples of British influence within the EU and of EU influence within the world more generally?
Baroness Warsi
My noble friend raises a very important issue and these are matters that will be raised. It is important that we value our relationship with the European Union. My noble friend quite rightly raises the issue of our place in the world. On foreign policy, for example, I know that the work we did on smart sanctions against Iran’s nuclear programme, against the Burmese regime to encourage democratic reform and against the Syrian regime was possible because we worked collectively.
Lord Liddle
My Lords, the noble Baroness sets great store by encouraging investment into the United Kingdom from the emerging giants of Asia. Following the Prime Minister’s speech on Friday, we will face at least five years of economic uncertainty over our continued membership of the European single market. That is likely to prove a great deterrent to all forms of inward investment just at the moment when jobs and the revival of investment depend on it? Does the noble Baroness agree that in doing this the Prime Minister is not speaking for the national interest?
Baroness Warsi
It may well be that the noble Lord opposite has had sight of the speech and is therefore making judgments based on his opinion of what is in the speech. I await to see what will be in that speech, as do many of us in this House, and I can assure the noble Lord that this Government have done all they can to make sure that when opportunities present themselves, both within the Commonwealth and in the wider world, especially in relation to India, Brazil and China, we have very clearly laid out our store to say that Britain is open for business.
Lord Pearson of Rannoch
My Lords, do the Government agree that we have some 3 million jobs exporting to the European Union but that it has 4.5 million jobs exporting to us? Are we not, in fact, its largest client? When we leave the EU, will it not come running after us for a free trade agreement which suits us at least as well as our present arrangements?
Baroness Warsi
The noble Lord always has an interesting take on these matters and is in an interesting position to trade statistics. I can assure him that most Members of this House believe that we are stronger for being within the European Union.
Age of Criminal Responsibility Bill [HL]
(11 years, 10 months ago)
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Growth and Infrastructure Bill
(11 years, 10 months ago)
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Lord Ahmad of Wimbledon
That it be an instruction to the Committee of the Whole House to which the Growth and Infrastructure Bill has been committed that they consider the Bill in the following order:
Clause 1, Schedule 1, Clauses 2 to 6, Schedule 2, Clauses 7 to 9, Schedule 3, Clauses 10 to 14, Schedule 4, Clauses 15 to 32.
Legislative Reform (Constitution of Veterinary Surgeons Preliminary Investigation and Disciplinary Committees) Order 2013
(11 years, 10 months ago)
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Earl Attlee
That the draft order laid before the House on 5 November 2012 be approved.
Relevant document: 9th Report from the Delegated Powers and Regulatory Reform Committee, considered in Grand Committee on 10 January.
European Union (Croatian Accession and Irish Protocol) Bill
(11 years, 10 months ago)
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The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi)
My Lords, I beg to move that the Report be now received. I would also like to respond briefly to points raised in Committee by the noble Lord, Lord Anderson, and the noble Earl, Lord Dundee, with regard to further EU enlargement in the western Balkans. I reassure the noble Lords that regional co-operation and good neighbourly relations are essential elements of EU enlargement. This was reiterated in the General Affairs Council conclusions of December 2011. The conclusions set out the EU’s expectation that disputes within the western Balkans should not have a detrimental effect on the shared goal of progress towards EU membership.
Baroness Anelay of St Johns
My Lords, it is unusual that there are no amendments down today. While noble Lords are leaving, could they do so quietly? The Minister is having the courtesy to respond to points made in Committee, and I know that those who took part in Committee will want to hear her courteous remarks.
Baroness Warsi
The conclusions set out the EU’s expectations that disputes within the western Balkans should not have a detrimental effect on the shared goal of progress towards EU membership. The Government support that statement in full.
Croatia, with its recent experience of accession negotiations, can itself play a constructive role in supporting its neighbours on their EU paths. I am pleased to say that Croatia is already doing this, as the noble Lord, Lord Anderson, highlighted in his remarks in Committee. In addition to the UK’s support for candidate countries, the UK provides expert support through EU peer-to-peer twinning projects. For example, since 2010, the UK has been awarded six twinning contracts in Kosovo, and we have recently been awarded a new project in Montenegro. We have already hosted a delegation of Croatian twinners to explore how we can work together on new twinning projects as partners in the region.
Finally, it is important that the EU’s enlargement process works. Croatia’s successful accession is an important concrete means of maintaining the incentive of EU membership in other western Balkan countries. Croatia’s efforts will highlight that the EU rewards the hard work that underpins countries’ transformations.
Lord Anderson of Swansea
My Lords, I thank the Minister for her helpful replies to the questions that I have raised, and join with her in saying that it is clearly in our interests that the whole of the western Balkans be brought successfully into the European family. The accession of Croatia on 1 July will certainly be a signal step in that direction, and we join with her in giving Croatia, and indeed the rest of the western Balkans, every blessing on that journey.
European Union (Approvals) Bill [HL]
(11 years, 10 months ago)
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Scotland Act 1998 (Modification of Schedule 5) Order 2013
(11 years, 10 months ago)
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Lord Wallace of Tankerness
That the draft order laid before the House on 22 October 2012 be approved.
Relevant documents: 9th Report from the Joint Committee on Statutory Instruments, 13th Report from the Secondary Legislation Scrutiny Committee, 7th Report from the Constitution Committee
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I beg to move that the draft order laid before the House on 22 October 2012 now be approved. I am grateful that we will have longer to debate the order than would normally be the case, which I think will be welcomed on all sides of the House. It certainly reflects the interest that noble Lords have shown in this order, not least the comments and contribution of your Lordships’ Constitution Committee whose report has made a very important contribution to the parliamentary process.
On 15 October last year, the Prime Minister, the First Minister of Scotland, the Deputy First Minister and the Secretary of State for Scotland signed an agreement on behalf of our respective Governments that will, if this order is approved by this House, allow a legal, fair and decisive referendum to take place on Scottish independence. I think it important that we acknowledge at the outset of this debate just how far we have come. Your Lordships have discussed and debated this and related issues on many occasions. We all recognise that we face perhaps the most important political choice that people have taken in Scotland in more than 300 years.
Calls for separation from the rest of the United Kingdom are not new, but the process that we are debating today began with the Scottish National Party’s victory in the May 2011 Scottish parliamentary elections and its manifesto pledge to hold an independence referendum. In May 2011, the Scottish Government claimed they had the right to bring forward legislation in the Scottish Parliament, without any role for this Parliament. The Scottish Government proposed the establishment of a separate Scottish Commission to oversee the process, and there was an expectation that there would be a multi-option referendum. Indeed, just 12 months ago, when the United Kingdom Government launched their consultation paper, that was very much still the case.
From the very beginning, this Government acknowledged the political mandate that the SNP had secured for a referendum. However, we also set out our very firm view that any referendum had to be legal, fair and decisive. As I set out to your Lordships just over a year ago, the Scotland Act 1998 is very clear: the Scottish Parliament cannot legislate on matters reserved to this Parliament. That includes “the constitution” and, specifically,
“the union of the Kingdoms of Scotland and England”.
That is why we published a consultation paper on 10 January 2012 which set out the different ways to deliver a legal referendum. Our consultation paper set out the available legislative options and stated that our preferred option was to provide the Scottish Parliament with the legal competence to legislate itself. This received the overwhelming support of those responding to our consultation. More than 70% of respondents agreed that the Scottish Parliament should be given that power. Your Lordships’ Constitution Committee in its first report on the referendum in February 2012 welcomed the proposal to use a Section 30 order to confer on the Scottish Parliament clear competence to legislate for the referendum.
Lord Forsyth of Drumlean
I am most grateful to my noble and learned friend for giving way. On the point that 86% of the respondents supported the UK Government’s position, this position was that the referendum process should be looked after by the Electoral Commission. Why did the UK Government not insist on that being part of the Edinburgh agreement?
Lord Wallace of Tankerness
As I shall come on to explain, it is very much part of the Edinburgh agreement. The Electoral Commission is crucially and centrally involved in the oversight of this referendum.
Lord Cormack
I am most grateful to the Minister. According to the agreement, all the commission has to determine is whether the question is intelligible. It is not a matter of whether it is fair, or loaded, but whether it is understandable. Is that sufficient?
Lord Wallace of Tankerness
My Lords, the position is that the Referendum Question Assessment Guidelines published by the Electoral Commission in November 2009 set out its approach to reviewing questions for intelligibility. These guidelines state:
“A referendum question should present the options clearly, simply and neutrally. So it should: be easy to understand; be to the point; be unambiguous; avoid encouraging voters to consider one response more favourably than another; avoid misleading voters”.
That is the Electoral Commission’s guidance to the intelligibility question which my noble friend raised; those are the criteria I expect it to apply having regard to weighing up and assessing the question that has been submitted by the Scottish Government to the Electoral Commission. With regard to this question, we have sought to put the position of the role of the Electoral Commission and the role of the Scottish Parliament on exactly the same terms as would be the case if the United Kingdom Government were proposing a referendum, where we put the referendum to the Electoral Commission for its assessment on the same criteria. I will come on to that in a bit more detail in a moment. It will report to Parliament and ultimately Parliament will decide. We are seeking to put the Scottish Parliament in exactly the same position, vis-à-vis the question and the Electoral Commission, as the United Kingdom Parliament would be in any referendum which the United Kingdom Government were proposing.
Lord Foulkes of Cumnock
Would the Minister care to give his opinion about the question as currently proposed by the Scottish Government, which is,
“Do you agree that Scotland should be an independent country?”?
All the polling evidence, and one can consult MORI and others on this, shows that this kind of phraseology is biased and leads towards a particular outcome. It therefore fails the test on that basis.
Secondly, the Minister said that the referendum should be decisive. I am not clear what is meant by,
“Do you agree that Scotland should be an independent country?”.
It does not refer to membership of the United Kingdom in any way whatever. I have spoken to some of my colleagues here, who think Scotland is currently an independent country in many senses. Is it not unintelligible, and therefore not decisive in any way?
Lord Wallace of Tankerness
My Lords, the key thing is that the Electoral Commission makes that judgment. I have heard the points made—with considerable conviction—by the noble Lord, Lord Foulkes, and others, but at the end of the day it is for the Electoral Commission to make that assessment. What it thinks about it, having done the testing on it, is far more important than what Ministers in the United Kingdom Government think.
Until relatively recently, I was the spokesperson for the Wales Office in your Lordships’ House and therefore during the referendum on the extension of powers for the Welsh Assembly. I could see at pretty close quarters the work done by the Electoral Commission in framing the question for that referendum—the noble Lord, Lord Wigley, will recall it. I was very impressed—not least because it faced the additional issue of the question being in Welsh as well as in English—by the thoroughness with which the Electoral Commission dealt with that. I was also impressed by the way in which my right honourable friend the then Secretary of State for Wales responded to the terms of the Electoral Commission’s report.
Lord Kakkar
Was it not the case both that the Electoral Commission looked at the specific question for that referendum and that legislation was brought before this Parliament? Therefore, this Parliament also had the opportunity to look at the question. The question for the referendum in Scotland will not be brought before this Parliament and we will not have an opportunity to look at it. Is it not still the responsibility of this Parliament to take care and to discharge its obligations to the citizens of the entire union?
Lord Wallace of Tankerness
The noble Lord is right about the Welsh referendum: the question was brought before this Parliament and was determined by it. However, as I sought to explain to my noble friends Lord Forsyth and Lord Cormack, this order seeks to put the Scottish Parliament in exactly the same position as this Parliament would be vis-à-vis a question for a United Kingdom referendum or a referendum that came under the responsibility of this Parliament. We want to put the Scottish Parliament in that position for the referendum on independence. If we are going to devolve power to do that, it is important that that is on the same basis as if this Parliament were responsible for the referendum. If this order is approved, it is up to the Scottish Parliament to make that judgment, and political consequences will flow from it if it is felt that the wrong judgment is made. We look forward with confidence to the Electoral Commission testing the question thoroughly—as it is indeed currently doing—and to make a report, and we will all be well aware of what the content of that report is. Perhaps I might make progress after I have answered the noble Lord, Lord Williamson.
Lord Williamson of Horton
I comprehend that point, but we have our own Constitution Committee, which has stated:
“We are concerned about whether a referendum on independence will be intelligible unless it specifies that the consequence of independence is Scotland leaving the United Kingdom”.
What comment does the Minister have to make on that point, which is the view of our Constitution Committee? I understand the point that he made about the responsibilities of the Scottish Parliament.
The Countess of Mar
My Lords, may I very courteously suggest to the House that we hear the Minister’s speech, and that we will all have time to add whatever we want afterwards and to ask him questions to which he can respond at the end of the debate?
Lord Wallace of Tankerness
I am grateful to the noble Countess and, in that spirit, I shall seek to answer questions afterwards. I have indicated what criteria the Electoral Commission uses in determining intelligibility. However, I think that many of us want to get on to actually debating the issues, because we have a responsibility, too, to deploy the arguments so that people are very clear about what the consequences would be.
Following the respective consultations of the United Kingdom and Scottish Governments, a period of discussions between Scotland’s two Governments led to the signing of the referendum agreement on 15 October. It is important that we recognise the significant achievement that this agreement represents: agreement to promote this order that we are debating today to ensure that the referendum is legal; agreement that the independent Electoral Commission should oversee the referendum to ensure that it is fair; and agreement to a single question on independence to ensure that the referendum is decisive.
I have said on a number of previous occasions that there is nothing worse than having a referendum that at the end of it one side or the other can call foul. I believe that the various strands that have been brought together to achieve the agreement will allow us to avoid that. They are a long way from where we were when this debate started in May 2011.
However, we also agreed another key point: once the fundamental requirements to ensure that the referendum is legal are established, fair and decisive, the responsibility for setting out the detail of the legislation should be for the Scottish Parliament. That is a fundamental point of principle on which I have already spoken and on which I will say more.
I will first take your Lordships through the order itself. It is made under Section 30(2) and (4) of the Scotland Act 1998. It inserts a new paragraph (5)(a) into Part 1 of Schedule 5 to the Scotland Act 1998. Part 1 provides, among other things, that the Union of the Kingdoms of Scotland and England is reserved to the United Kingdom Parliament. The new paragraph (5)(a) will ensure that the reservation does not apply to a referendum on independence, provided that it meets the requirements that are set out.
Those requirements are for a single ballot paper with a choice of two responses—in other words, a single question referendum on independence, to be held before the end of 2014, and without any other referendum provided for by an Act of the Scottish Parliament to be held on the same day. The order also makes provision in respect of public referendum broadcasts and free mailshots, which otherwise would be outwith the legislative competence of the Scottish Parliament.
Under the Political Parties, Elections and Referendums Act 2000, otherwise known as PPERA, referendum campaign broadcasts can be made only by or on behalf of a designated campaign organisation. The order applies this provision of PPERA to an independence referendum. This means that the restriction in PPERA as to who can make referendum broadcasts can apply to that referendum.
There are requirements on Ofcom and the BBC in relation to referendum broadcasts. The order provides that the definition of referendum campaign broadcasts includes independence referendum campaign broadcasts in certain circumstances so that the BBC, Ofcom and the Electoral Commission can have the same obligations and responsibilities in respect of the independence referendum campaign broadcasts as they would have in respect of any PPERA referendum broadcasts.
Under the 2000 Act, each designated campaign organisation can send a mailshot to every elector or household and is not required to pay the postage costs for this. This service is provided by the Royal Mail and the costs of this are recovered from the Consolidated Fund. This order applies these provisions in PPERA to an independence referendum. It specifically provides that the cost of the Royal Mail in providing this service will be recovered from the Scottish Ministers.
Therefore, the Section 30 order that we are debating today enables the Scottish Parliament to legislate for a legal referendum. The Scottish Parliament has already considered the order and approved it unanimously. Yesterday the order was debated in the House of Commons and approved without division, and if the order is approved by your Lordships’ House and then by the Privy Council, it will enable the Scottish Government to introduce a referendum Bill that sets out the wording of the question, the date of the referendum and the rules of the campaign for the Scottish Parliament to consider.
This devolution of power will ensure that the detail of the referendum process itself is made in Scotland by the Scottish Parliament. As I have already set out to your Lordships, this is a principle of importance to the devolution settlement. Once a matter is passed to the Scottish Parliament, it is for that Parliament to determine the details of the legislation that follows. That is how devolution has operated since 1999 and this Government will continue to respect that.
The referendum agreement and the Section 30 order set out the framework for the referendum. They ensure that it is legal, capable of commanding the confidence of people from both sides of the debate and of producing a decisive result.
I will now say something about the detail of the memorandum of agreement that sits alongside the order. It is a statement of political intent by Scotland’s two Governments. It commits us jointly to an approach and delivery of the independence referendum that will ensure that the proceedings are fair and that the outcome is decisive.
At the heart of any referendum must lie a set of rules and processes that have the support of both sets of protagonists. For the outcome of any referendum to be legitimate and accepted, both sides of the argument must have faith in all aspects of the referendum. That is particularly true when we are considering the future of our nation. The agreement therefore sets out the commitment of both Governments to the normal rules and procedures that govern referendums in the UK as contained in PPERA.
A core part of the PPERA process is the central role of the Electoral Commission. The two Governments have agreed that the Electoral Commission must review the proposed referendum question and that its report will be laid before the Scottish Parliament, and that process is under way. It is worth reminding the House that since PPERA came into force there have been three referendums held under it: the north-east regional assembly referendum in 2004; the one to which I have already referred in Wales on further devolution in 2011; and the referendum on the voting system for the United Kingdom Parliament, also held in 2011. In all three cases, the Electoral Commission reviewed the Government’s proposed question and provided its advice, and the Government responded by revising the question in line with that advice.
Lord Foulkes of Cumnock
Will the Minister give way on that particular point?
Lord Wallace of Tankerness
No—as the noble Countess said, the noble Lord will have an opportunity later, and I will certainly respond. Well, if it is very quick, yes.
Lord Foulkes of Cumnock
Does this include whether money can come from overseas sources, as well as total expenditure?
Lord Wallace of Tankerness
When I respond to the debate I will give a more detailed response to that, but I think that those arrangements are already there under PPERA.
That is what happened in previous referendums such as the 2011 referendum in Wales on further powers for the Welsh Assembly. In that referendum, the Electoral Commission recommended that the spending limit for designated campaign organisations should be set by reference to the expenditure limits that applied to elections to the relevant legislature. In its response to both Governments’ consultation documents, the Electoral Commission provided its view that the model remains appropriate for the Scottish independence referendum.
The Electoral Commission has also met the parties represented in the Scottish Parliament to seek their views on the financial arrangements. When the Scottish Government set out their final proposals for financing the referendum campaign in their Bill, they must set themselves aside from their own campaigning interests and recognise that their approach is being watched by all of Scotland, and indeed by the wider international community. This is a point which the Deputy First Minister, Nicola Sturgeon, herself recognised when she said that the poll must satisfy the highest standards. It is only right that we use the bar that she has set to determine whether what is proposed is appropriate.
Both Governments agree that the basis for the franchise will be that for the Scottish Parliament elections —that is, those UK or EU citizens who are resident in Scotland. Again, that is set out in the agreement.
In addition, the Scottish Government propose to give 16 and 17 year-olds the right to vote. I recognise and very much respect the fact that there are differing views on this issue in this Parliament and in this House. My party, the Liberal Democrats, supports the principle of 16 and 17 year-olds participating in all elections; our coalition partners do not. Indeed, there are views on both sides of the Chamber on that issue. However, in devolving the power to hold the referendum, we respect that this is a matter which should be debated and determined by the Scottish Parliament.
Indeed, where the Scottish Government and Parliament have the power to hold referendums and elections already, they have chosen to allow some 16 and 17 year-olds to vote. However, the Scottish Parliament’s decision with respect to health board elections and Crofting Commission elections in Scotland has set no precedent for any elections for which the United Kingdom Government and Parliament are responsible.
I fully expect the Scottish Government’s proposals to be debated robustly in the Scottish Parliament. It will be for the Scottish Government to make their case for this proposal and to deal with the issues that arise.
I can make it equally clear that any decision taken by the Scottish Parliament for the referendum will not affect the voting age for parliamentary and local government elections in the United Kingdom. That remains the responsibility of this Parliament alone to determine.
I turn to an issue which has attracted comment, particularly from the Scottish Government. The concluding paragraph of the Edinburgh agreement contains a commitment by both Governments to hold a referendum that is legal, fair and decisive. It is fair to say that there have been some creative interpretations of that paragraph in recent times, so I want to take the opportunity to restate its clear and very obvious meaning. Perhaps it is worth reminding the House what it actually says:
“The United Kingdom and Scottish Governments are committed, through the Memorandum of Understanding between them and others, to working together on matters of mutual interest and to the principles of good communication and mutual respect. The two governments have reached this agreement in that spirit. They look forward to a referendum which is legal and fair producing a decisive and respected outcome. The two governments are committed to continue to work together constructively in the light of the outcome, whatever it is, in the best interests of the people of Scotland and of the rest of the United Kingdom.”
This means that the two Governments will conduct the referendum on the same constructive terms as they work on today. It means that if the referendum follows the path set out in the order and agreement, its outcome will be decisive. It means also that, regardless of what the result is, that constructive relationship should continue as we move forward. I believe that that is good practice and common sense. Paragraph 30 is a statement of our determination to hold a referendum that is legal, fair and decisive. However, it does not and cannot be interpreted in a way that pre-empts the implications of that vote. It is important that everyone is very clear about that reality.
Scotland’s future within the United Kingdom will be the most important decision we in Scotland take in our lifetime. Facilitating a legal, fair and decisive referendum is critical. That is why we consulted on this issue. That is why both the Scottish Government and the United Kingdom Government spent many hours discussing and negotiating the process. That is why we seek the support of the House today to approve this order.
Debating this order in this House today marks an important step as we move from discussions on process to what many of us want to do—get to the substance of the debate. It is essential that the referendum decision is focused on determining whether Scotland chooses to remain an integral part of the most successful partnership of nations that this world has ever seen and to remain part of a family of nations that works in the interests of all, or whether Scotland wishes to separate and go it alone.
That is not a decision that should be taken lightly; it should be taken after examination of the facts. I strongly believe that, with the support of colleagues across the House, across Scotland and across the whole of the United Kingdom, fellow Scots will join me in autumn 2014 in choosing to stay part of this very valued United Kingdom. I believe that we are indeed better together. In the mean time, I commend this order to the House.
Amendment to the Motion
Lord Forsyth of Drumlean
At end to insert “but that this House calls on Her Majesty’s Government not to make the draft order until the proposals for the date of the referendum, the proposed question and the rules governing the conduct of the referendum have been published and until both Houses of Parliament have debated those proposals”.
Lord Forsyth of Drumlean
My Lords, if I am ever facing a murder charge, I very much hope that the noble and learned Lord, Lord Wallace of Tankerness, will, as a good Scottish advocate, be there to defend me. He has made a very convincing case out of quite a thin brief, if I may say so.
It may be convenient for the House if I speak to both my amendments. Neither amendment is fatal. If the House were to pass them, they would make absolutely no difference to the order, because they are simply advice to the Government. For that reason, I am not proposing to press my amendments to a Division—and out of respect to the other place, which agreed the order unanimously without a Division.
However, that is not to let my noble and learned friend off the hook, because there are some very serious issues. What are we doing here? We are passing responsibility for a referendum that will determine the future of the United Kingdom to the Scottish Parliament, my noble and learned friend would say. But in fact the Scottish Parliament is one man: Alex Salmond. He completely dominates the Scottish Parliament. We are passing responsibility for the conduct of the referendum to a man who has made it his life’s work to destroy the United Kingdom. We are doing so without knowing the question, without knowing the date of the referendum, without knowing the rules on expenses for the conduct of the referendum and without even knowing who is going to be allowed to vote in the referendum. That is after—how many months?—seven months of negotiation between the Government and the First Minister.
We have no commitment whatever from the First Minister that he will abide by the advice of the Electoral Commission. As my noble and learned friend Lord Wallace pointed out, every other party in the Scottish Parliament has said that it will abide by the advice of the Electoral Commission on the question, and on the rules of engagement and expenses—but not Alex Salmond. I wonder why that should be.
To cap it all, in November the First Minister produced his question. The question that he has suggested, which is contained in my second amendment, is:
“Do you agree that Scotland should be an independent country?”.
There is no more committed unionist in this House than I am, but I would be tempted to answer yes to that question. Scotland is an independent country. In 1707, we did not give up our status as an independent country. Indeed, the Act of Union guarantees those aspects of Scotland that make it an independent country. We have our own legal system and our own education system. We have a completely different tradition in many respects. We even have our own languages. If the question were, “Do you agree that Scotland should be an independent state?”, then of course I know the answer. It is perfectly clear that it is no. By the way, any question that starts “Do you agree” is by definition a loaded question.
It is extraordinary that you have to get to Article 4(5) of the order, on the very last page, to see any mention of independence. It says:
“In this article ‘independence referendum’ means a referendum on the independence of Scotland from the rest of the United Kingdom, held in pursuance of provision made by or under an Act of the Scottish Parliament”.
The order makes it clear that a question framed in terms of whether you think Scotland should be an independent country is, to say the least, utterly misleading.
The Electoral Commission costs a great deal of money. In fact, it costs about half what the Royal Family costs. It has a staff of 129 people but it seems to be incapable of providing the advice on the question, which it has had since 12 November, in time for the House of Commons and this House to have this debate. That is an absolute disgrace. We should have had the advice from the Electoral Commission on the question. In the very fine debate in the other place yesterday, speech after speech centred on the issue of the question, its fairness and whether the Electoral Commission’s advice would be obtained. I asked the Electoral Commission why it could not provide us with the advice and it said that it was allowed 12 weeks and that, with the Christmas period, it was very difficult for it to do so. I have to say that for the Government to bring this order before these Houses before we have that advice is just not acceptable.
As I pointed out to my noble and learned friend, 86% of the responses to the consultation said that the Electoral Commission should be responsible for overseeing the poll. Why have the Government not insisted on that? My noble and learned friend is very good with words and he gives the impression that the commission is overseeing the poll. It is not; it is in a position where it gives advice and the Scottish Government, the Scottish First Minister or the Scottish Parliament may ignore that advice.
We have also heard from my noble and learned friend the suggestion that the determination on the part of the Scottish First Minister to extend the franchise to 16 and 17 year-olds will have no implications for the rest of the UK. I find it extraordinary that this order can have rules included that make the position on broadcasting expenditure and on free post absolutely clear but that it apparently cannot make the position clear on the franchise or indeed the role of the Electoral Commission.
Lord Reid of Cardowan
Given the noble Lord’s many valid criticisms of the weak negotiating outcome that the Government have presented to us, which is really what he is complaining about, I do not think that he should underestimate the question of the political legitimacy of the First Minister should he refuse the question that is put forward. I know that that is not the noble Lord’s intention, but in the manner in which he is presenting it he is almost making it a foregone conclusion. We should make the question of fairness and political legitimacy so important in this referendum that if the commission was to recommend a question, which then, for partisan purposes, was refused by the First Minister, that would become a central element of this political campaign. Let it be known now that we would do so, that there will be a cost and that anyone who acts unfairly on this vital question for Scotland will be seen by the people of Scotland to be acting unfairly. I hope that the noble Lord will reflect on that. I agree with a great deal of what he has said so far, but we must make sure that, if unfairness is deployed, there is a price to be paid for it by the leader of the SNP.
Lord Forsyth of Drumlean
I have considerable respect for the noble Lord. Of course I take his point, but what conceivable reason could Alex Salmond have for not agreeing, along with the other parties, that the Electoral Commission’s advice should be followed unless it was that he wanted to rig the question? The noble Lord says, “Ah, but there will be a political price”, but shall we spend the rest of the referendum campaign saying, “Ah, but the question is unfair”? What happens if we win or lose by a tiny margin? There will be arguments forever after about whether it was a fairly conducted referendum campaign. That is why we need to lance this boil at an early stage. It is no good setting off from the starting line and throughout the race saying, “By the way, this is not a fair race”. We have to win this race if we are to save the United Kingdom.
Just in case the noble Lord thinks that I am being partisan, I should say that I was quite struck during the debate on the order in the other place by what Mr Alistair Darling, the Member for Edinburgh South West, who is playing such a fantastic role in leading the campaign for the union in Scotland, said about passing responsibilities to the Scottish Parliament. He said:
“There is absolutely nothing wrong in that”.
However, he went on to say:
“In practice, the transfer is not just to the Scottish Parliament but to the SNP, which runs the thing as a pretty tight ship—opposition is not usually tolerated—and not just to the SNP, because, as we know, the SNP is very much run by one individual. We need to be aware that that is what we are doing”.
It is absolutely essential that we understand that. Talking about the Edinburgh agreement, he said:
“That suggests that both parties were clear that the Electoral Commission’s role was impartial and that there was an assumption that they would accept whatever it proposes. It is, therefore, disappointing that before the ink was dry on the signatures, we heard from senior members of the SNP that the Electoral Commission could say what it wanted, but it would ultimately be the SNP’s call. That would be unfortunate, in relation to both the wording of the question and the spending limits”.—[Official Report, Commons, 15/1/13; cols. 762 and 764.]
The only thing in that with which I would argue is the use of the word “unfortunate”, for which I would substitute “disastrous”.
There is within elements of the Government and elements of the unionist campaign a creeping complacency which I find really worrying. I keep hearing people saying, “Oh, there is only 33% support for independence”. I ask them to have a look at Quebec. In the referendum for secession there, the position started off with 70% to 75% opposed to secession; in fact, it was 67:33—almost exactly where we are now. By the end of the referendum campaign, the vote against was won by 0.6%. Let us not be cavalier in giving away things that could make all the difference, such as the weighting of the question and the ability of people to get their messages out at this stage.
I point out to my noble and learned friend the causal way in which the Government regard the extension by the Scottish Parliament of the franchise to 16 and 17 year-olds, with all the implications that that will have. I do not have a particularly strong view—actually, I do have a strong view. I do not think that 16 and 17 year-olds should have the vote, but I am open to persuasion. However, what I cannot be persuaded of is that they should have the vote for some elections but not for others. Frankly, saying that the Scottish Parliament has given them elections for the Crofters Commission and that that somehow indicates that there is no precedent for the United Kingdom is an argument of a quality to which I hope the noble and learned Lord will not stoop when he is defending me.
We are suggesting that people in Scotland should not be able to buy a packet of fags or, as someone said in the other place, a packet of sparklers, or a drink in the pub, but that they can decide the future of the United Kingdom. We are suggesting that all of this can be done on the basis of what Alex Salmond decides when he gets out of bed in the morning. This is utterly frightening. If ever there was an example of the tail wagging the dog, then this is it. The franchise should be a UK matter.
My noble and learned friend, in echoing the Secretary of State, is talking nonsense when he expounds this view of devolution. The Secretary of State for Scotland said of the order:
“This devolution of power will ensure that the details of the referendum process itself are made in Scotland, in the Scottish Parliament. That is a principle of great importance to the devolution settlement. Furthermore, the approach here respects another key feature of devolution—namely, that once a matter is passed to the Scottish Parliament, it is for that Parliament to determine the details of the legislation that follows”.—[Official Report, Commons, 15/1/13; col. 745.]
That last is a point made by my noble and learned friend. This is not about devolution. The future of the United Kingdom is not a devolved matter; it is for the United Kingdom. It is true that the United Kingdom Government have decided to amend and use the powers in the Scotland Act to overturn the limitation in order to give the Scottish Parliament that power. I do not have a problem with that, provided that we know what we are getting ourselves into. I believe that we are at risk, given the way in which we are proceeding and the trust that we are putting in Alex Salmond. It is a bit like putting the fox in charge of the chicken coop and arguing that the chickens will protest if it all goes wrong.
The Scottish Government, simply in any fairness, cannot be a participant and the referee at the same time, especially given that this First Minister has form. He was caught out telling porkies about whether he had had advice on whether we would have to rejoin the European Union if we were independent. He spent taxpayers’ money on preventing people getting, under freedom of information legislation, the facts, which turned out to be that what he had said was not true at all. He has already had a red card. I think that we should be concerned about trust.
Another point on the uncertainties that remain is about the timetable. It is absolutely ridiculous that we do not know the date of the referendum. It has to be by 2014, but everyone says that having to wait until 2014 will be hugely damaging to the Scottish economy and hugely damaging to business, will create enormous uncertainty and will bore us all to death, because we will be talking about this for far too long. We need to get on with it.
My noble and learned friend said that he was anxious to avoid talking about process and to get on with the arguments. If he is anxious to get on with the arguments, why on earth are we leaving these issues of process—the question and the rules of the referendum—open to more and more argument over a longer period? The Scottish Government are not even proposing to publish their White Paper until the end of the year—and presumably the Bill will be published after that—so we will be focusing on process because these matters have not been addressed.
Of course, the First Minister agrees with the Electoral Commission that the Scottish Government will need to be in purdah for only four weeks before the referendum. Given the disgraceful and partisan way in which the Permanent Secretary in the Scottish Office has behaved, and given the way in which Alex Salmond clearly is using his role in the Scottish Government to pursue a political agenda, I think that four weeks is far too short a time.
My noble and learned friend is right to say that we need to resolve these matters and get on with discussing the issues. I have to say to him that the UK Government have got some questions to answer as well. We cannot go on with a situation where, for example, the Ministry of Defence is saying, “No, we are not making any contingency plans as to what to do about the Trident nuclear deterrent if Scotland becomes independent and the SNP keeps its commitment to throw the nuclear weapons out of Scotland. We are not doing anything because we do not think that it is going to happen”. That is not good enough. The department should be setting out what the consequences would be in terms of the jobs lost—around 10,000 in Scotland—what the cost to the English taxpayer would be and what the future of our deterrent would be. That applies to every single government department. They should stop sitting there thinking that it is not going to happen. We have a duty to ensure that the voters know exactly what the consequences of voting for independence would be.
The SNP has a role, too. It needs to make its case. It is extraordinary that we will have to wait until the end of the year to hear how the proposal will work. It has had about 30 years to think about it.
Lord Forsyth of Drumlean
My noble and learned friend says 80 years. Yet we have no response. The First Minister is known as something of a gambler. Ironically, his campaign will be funded on a lottery win, on which, of course, no tax will have been paid. The other part will come from overseas supporters, such as Sean Connery. The noble Lord, Lord Foulkes, made an important point. The Electoral Commission thinks that it is inappropriate for foreign money to be deployed in the campaign, but, once again, Mr Salmond is taking the view that he will not rule that out. Even now, overseas funds are being raised in America. I do not know what it is about the SNP that it has great stars, such as Alan Cumming and Sean Connery, who will do anything to support independence except live in the country that they are arguing should be independent.
I said to my noble and learned friend that I would not press this to the vote but, as I have listened to myself talking, I have been tempted to do so because the case seems absolutely overwhelming. Today, I want an assurance from the Minister that the Government will put pressure on Mr Salmond to answer these issues and to come forward and tell us what the question will be. Most important, we need an absolute commitment that the Electoral Commission will act as referee and its advice will be accepted.
Lord Foulkes of Cumnock
The noble Lord has called on the Government to put pressure on Mr Salmond. From time to time, it is better for some of us who are perhaps long-term opponents of Mr Salmond to keep quiet about him, but would it not be helpful if the supine Scottish media looked at the SNP and its policies, started to put them under scrutiny and started to ask serious questions about what Scotland would really be like under independence? Should we be asking them to show us that they can do their job properly?
Lord Forsyth of Drumlean
I have to say to the noble Lord that I am quite ambitious, but to suggest that I could get him to keep quiet probably is stretching reality. The media are only as good as the information that they are given. If we are honest with ourselves, the pro-union campaign has been a little slow in getting off the mark—by that, I mean the Government—and setting out the facts. We still are arguing about questions, rules and dates, all of which should have been resolved long ago. We should be talking about the consequences for jobs, employment, investment, defence and our future in the European Union. These are the matters that should be discussed. They are the very last things that Alex Salmond wants to discuss because he and his party do not have any answers as to how our financial institutions would be regulated, how we would be able to operate in a modern world and where they would be in terms of asking to join the European Union from a position of weakness.
I fear that I have gone on for far too long. The Secretary of State for Scotland said that this was the most important question in United Kingdom politics for more than 300 years. I find it sad that the involvement of both Houses of this Parliament should be so limited in a question that is so important—he is absolutely right in that respect. It seems to me odd that the mother of Parliaments is being excluded from this process. My noble and learned friend and his colleague, the Prime Minister, went to Edinburgh. They did a deal in a room, which was never discussed by Parliament. There has been no opportunity for us to do anything. I am reduced to moving an amendment that will make no difference whatever. Even then, Alex Salmond is distorting what we say. I know that Members opposite worry about Alex Salmond and the way in which he seeks to present our commitment to the United Kingdom as being in some way anti-Scottish. It is not anti-Scottish to seek to defend Scotland’s right to remain a part of the United Kingdom and to play a proud and honourable role in this process. I beg to move.
Lord Reid of Cardowan
My Lords, it is a great privilege and challenge to follow the noble Lord, Lord Forsyth, on a subject such as this. On this occasion he probably has more support from more people in Scotland than he ever did when he was Secretary of State for Scotland. When he started his reminiscences, it showed how long he has been involved with these matters. He mentioned that he was a leading member of the students’ union at the University of St Andrews in the days when Gordon Brown was rector of Edinburgh University. I was student president at Stirling University and a certain Mr Alistair Darling was student president at the University of Aberdeen. As he pointed out, in those days—no doubt because of his own prowess—there were some 1,500 members of St Andrews Conservative Association and only four members of the SNP. This is presumably why St Andrews did not belong to the National Union of Students but followed the policy of absolute separatism in those days. I agree with a great deal of what the noble Lord said but I am glad he is not pushing the amendment to a vote for reasons that I will explain. It also liberates me to agree with him more than I would have done.
Two distinct questions are being debated around this order. The first is whether the Government made a good fist of the negotiations, the handling of the communication of their argument and the consultation with Parliament. The noble Lord has just given a pretty devastating critique of all three. The second is how we, as parliamentarians, were to respond, and whether our tactical differences over the mishandling of an amalgam or ensemble of tactical questions were sufficient for us to take a strategic decision to vote to renege on that agreement. That would have placed us in an extremely difficult position because, although I agree with a great deal of his criticism, had we taken such a vote, it would have played into the hands of those in Scotland who wish to portray the Westminster Parliament as somehow opposed to this whole exercise.
I just want to make one correction. It was never promised that devolution would stop the aspirations of the Scottish people for independence or separatism or anything else. What was said was that, all other things being equal, it would minimise the chances of the people of Scotland separating themselves from the people of England. That is still absolutely true, although you would have to speculate where we would now be if, throughout the period of Mrs Thatcher and afterwards, we had never given Scotland any degree of devolution, which is the correct way of balancing that.
I will give way to the noble Lord who, in his normal, non-partisan fashion, will deal with questions concerning devolution.
Lord Forsyth of Drumlean
I just wonder whether the noble Lord can tell me what, “devolution will kill nationalism stone dead” meant.
Lord Reid of Cardowan
It meant that the nationalist aspiration of separating Scotland from the rest of the United Kingdom would be defeated. It meant that we would remain a partner in the United Kingdom for much longer than we would if we failed to give an inch to the aspirations of the Scottish people to meet their national consciousness through a degree of control over it. In order to prove his point, the noble Lord would have to argue that, had we not done that, the demand for separation in Scotland would be less than it is now, and I would strongly disagree. However, today I want to try to stress what unites us here, rather than historical differences.
Lord Robertson of Port Ellen
Those people who suggested that devolution would kill nationalism or the SNP stone dead have yet to be proved wrong.
Lord Reid of Cardowan
I believe that in the outcome of the referendum they will be proved to have been right. That is why I am optimistic. It is an optimism of the will, although I agree that we have to have pessimism of the intellect and to study contingencies on every front.
That leads me to the one area of disagreement that I have, which I think is important. If we do not understand the premise of what we are arguing, the conclusion will be wrong. It is not technically or politically wrong that many of these issues have been passed by the Government to the Scottish Parliament, because the question here is whether the people of Scotland wish to leave the union. The question in Wales was whether the people of Wales and the Assembly wished to change the relationship of the United Kingdom. There are two distinct things here. One is, when you want to leave a club, that is your decision; the other is, if you want to change the rules of the club, it is not your decision but the decision of everyone inside the club. That is why I believe it is right technically and legally that, following negotiations, many things have been passed down, although I entirely agree with the noble Lord, Lord Forsyth, in his estimate of the efficacy of the Government’s efforts in the negotiations themselves.
There were three major areas in those negotiations. One was the timing, one was the clarity and nature of the question, and the third was neutrality. On the timing, I cannot for the life of me understand why those of us in Scotland—and ultimately it is the Scottish people who will be making this decision—who have been debating this issue in some detail since at least the 1970s, and in many ways since 1707, have to wait another two years for a decision on this. I know whom it suits. It does not suit those of us who want an open debate and conclusion of this matter; it suits Alex Salmond. First, he has chosen a date which, he hopes, will be at the fag end of this Government and therefore he can draw attention to the terrible effects of five years of a Westminster-based Tory Government, as he will portray it. Secondly, the referendum will be held after four years of an SNP-led Administration in Scotland, when he can say, “You see, we didn’t frighten the horses”. To boot and for good measure, it will be the 700th anniversary of the Battle of Bannockburn. Therefore, I can see why he would choose to have it on that date, even if it inconveniences the rest of Scotland and two years of further dubiety about the status of our country affects our economic and social welfare. It will certainly not be in the interests of the people of Scotland, the economy or the social structures to delay the referendum that long.
Lord Foulkes of Cumnock
Is he not also hoping for some reflected glory from the Ryder Cup and the Commonwealth Games being held in Scotland in that year as well?
Lord Reid of Cardowan
I do not know. That is possibly the case, but I have given up the psychoanalysis of prominent figures. However, I have to say: be careful. I am not frightened of Alex Salmond and I do not know why we give him the status that he appeared to be given earlier. I believe we should have the confidence to say that ultimately this decision will be made by the Scottish people. We may have a fox in charge but we do not have chickens. We have in the region of five and a half million good strong people in Scotland who will make their own decision after an aggressive argument during, as it now happens, another extended period. On the timing, I think that the Government were weak. If they had truly been speaking to the people of Scotland, they would have said, “Let’s have a decision now. We’ve been debating this for decades”.
Secondly, there were two aspects concerning the question. One was of huge strategic importance and it was whether or not to have one clear question. On that, to give credit to the Government, they stood firm and we have it. We know why the First Minister wanted the other question. It was because he thought it would be more achievable, and the way it was to be achieved was not by him admitting to his fundamentalists that he would have settled for less than full separation. And, for goodness’ sake, I hope that the Government will recognise that we are already a sturdy, independent country. What is being asked for here is separation, not independence. Like any independent person, as a country we can choose, and have done for centuries, to ally and partner with other countries in order to punch above our weight. We did so before the Reformation with France; we did so after the Reformation with the great centres of learning of Europe, such as Geneva; and we did so throughout the British Empire when we ran it—although we can blame the English for the all the ills that ensued afterwards. It would therefore be helpful if the Government referred to this as what it is: a campaign for separation, not a campaign for independence.
Lord Stephen
My Lords, I start by agreeing with the noble Lord on that issue of service men and women of the United Kingdom, and of Scotland, who should have the opportunity to vote in this referendum. The issue was raised yesterday in the other place in many good speeches on this Section 30 Motion. I listened to a great deal of that debate yesterday, and although there was full cross-party consensus on the approval of the Motion, there was also, outside the nationalists, cross-party concern. That concern is shared by me and by my noble friend Lord Forsyth, as reflected forcefully in his remarks this afternoon, and clearly in the terms of his two amendments. Before focusing on that concern, we should recognise the good points of what has been achieved and of this Motion.
Michael Moore, as Secretary of State for Scotland, and the Prime Minister deserve great credit for delivering the Edinburgh agreement. Michael Moore skilfully negotiated, no doubt with the support of my noble and learned friend the Advocate-General for Scotland, an agreement that all sides agree is a good start, and a good way forward. It has been agreed by the Prime Minister, the Scottish Secretary, the First Minister and the Deputy First Minister that it is central to the principles underpinning this referendum that it should be legal, decisive and fair.
Let us take those tests in turn. First, it will now be legal, by the securing today of this Section 30 Motion and its approval under the terms of the Scotland Act 1998. In my view it was pretty clear, but some would say that it was a matter of doubt whether the Scottish Parliament had the legal powers to hold a referendum on independence. It is clear that those powers had not been devolved to the Scottish Parliament and that doubt will be removed today by the passing of this order. That is good. Secondly, as has been mentioned by others, it will now be a decisive referendum. There will be one question only. Despite the views, interestingly, of his party, which wanted one question, the First Minister wanted two questions. Clearly, he wanted an escape route. He wanted the cover and protection of a second question on more powers for the Scottish Parliament, but that emergency exit is now being removed. There will be a simple yes/no question, which means that the decision will be clear cut. That is also good news.
We then come to the third issue about fairness, on which I want to spend a little time. It has been covered pretty fully already, but it is vital that the referendum is fair if it is to command respect. We already know the SNP-preferred referendum question. We know the question that the Government in Scotland want to ask and it is not fair; it is a biased question. My noble friend Lord Forsyth helpfully quotes it in his amendment, which asks:
“Do you agree that Scotland should be an independent country?”.
That is a rigged question on at least two grounds. I am not a great expert on these psephological matters but those who are explain that if you ask people to agree with you—do you like my tie, do you like my new haircut, do you like whatever principle—they will tend to agree in response.
Lord Wallace of Tankerness
They do not think about it for two and a half years.
Lord Stephen
Indeed. Those who know about these matters say that is the first element of rigging of the question. Secondly, and on this I am more familiar because it is surely a matter of law, and of international law at that, is the issue of whether you want Scotland to be an independent country. The correct question, I am told, is whether it should be an independent or a separate state. That is not the wording that the SNP proposes. Scotland is already a country; some people in this Chamber who are fierce unionists have already said they believe it is an independent country.
I am very pleased that the Edinburgh agreement sets out that the conduct of the referendum is to be overseen by the UK Electoral Commission—not a separate Scottish body—which is seen to be fair and objective and neutral. That is wholly good news. I was also greatly encouraged when I saw John McCormick, who many people in this Chamber will know is the Electoral Commissioner for Scotland, being interviewed on this issue by the BBC. He said that it was crucial that the question put to voters was clear, simple and neutral and went on to say, very importantly, that in his view the question was the foundation—the bedrock —on which this referendum would be built. If it was flawed or biased, the whole process would be flawed and biased. I agree with him completely. I do not agree with those who say the question does not really matter and that by voting day everyone will be pretty much clear on what the referendum is about—being in or out of the United Kingdom. It is important that the question is fair and commands respect on all sides from the start.
Some say it would make only a small difference, of maybe 2% or 3% either way. My noble friend Lord Forsyth has referred to the situation in Quebec. Some are saying it would be more than that, some less. Percentages are a curious thing, are they not? If British Airways downgraded its expectations of successful landings at Heathrow by 2% or 3%, international air travel would be killed overnight. If a casino said that a roulette wheel had a built-in bias in its favour of 2% or 3%, I dare say that many gamblers might still take the chance. We should not be gambling, however, with our nation’s future.
Finally, there is the issue of who decides in all of this. Is it the Electoral Commission? No, it is quite clearly the SNP, the Scottish Government and the Scottish Parliament that will decide the question. Can we trust the SNP on this issue? Well, no, because although it is both the player and the referee, it has made clear that the recommendations of the Electoral Commission are not binding on the Scottish Government and Parliament. Angus Robertson, in the House of Commons yesterday, and Alex Salmond, the First Minister, on Radio 4 this morning, have been given ample opportunity to make it clear, as the other leaders in the Scottish Parliament have done, that they would accept the views of the Electoral Commission on this crucial issue of bias and of avoiding anything other than an objective, neutral and fair question.
They have a mantra now, to get them out of the difficult question. The Electoral Commission will advise, says the First Minister. The Scottish Government will recommend and the Scottish Parliament will decide. Of course, as has been said, they have form on these issues of fairness, honesty and integrity—the very recent form that has been referred to, when the First Minister failed to tell Andrew Neil of the BBC the truth about whether he had taken legal advice on Scotland’s EU membership and the Scottish Government then used taxpayers’ money in the courts to resist revealing legal advice that the Scottish Government had never taken. That is the sort of “Alex in Wonderland”, topsy-turvy situation that we are dealing with. There is no honesty, integrity and consistency in a position such as that.
However, there is a deeply serious and worrying point. If this referendum is not based on a neutral question, it will be biased; if it is biased, it will not be fair; and if it is not fair, that will be a breach of the Edinburgh agreement to be “legal”, “fair” and “decisive”. In my view, we will then have a serious constitutional crisis. I trust that can be avoided and that the First Minister can rise above narrow partisanship and set a tone for this referendum that will command all-party respect right across the whole of Scotland and of the United Kingdom. On that basis, we should pass the Motion today, but remain fiercely, ferociously and for ever vigilant about the dangers that lie ahead, which could have such profound implications for both Scotland and the whole of the United Kingdom if some of the fears mentioned today come to pass.
Lord McConnell of Glenscorrodale
My Lords, when the noble and learned Lord, Lord Wallace of Tankerness, was Deputy First Minister of Scotland and I was First Minister of Scotland, there were probably times when he felt as if he was defending me against a murder charge, as described by the noble Lord, Lord Forsyth, earlier. I, too, appreciated the eloquence with which the noble and learned Lord introduced our debate this afternoon and his appreciation of devolution. I am also aware that we discuss these issues against hundreds of years of history—this month, in suppers all over the world, we will celebrate that century in which Scotland joined the union, and led the world in literature, science, engineering, philosophy and, of course, also in poetry. However, today, we debate only this order; not the outcome of a referendum and not the overall pros and cons of independence or separation.
I start my brief remarks by saying that I have believed passionately, since that 1979 referendum on devolution, that a devolved Scottish Parliament, inside the United Kingdom, is the best form of government for Scotland. I believe in shared sovereignty, which I believe we have. I also believe that despite the mistakes that have been made and will be made in the future by Scotland’s Parliament—just as this Parliament makes mistakes—Scotland is a better place today for having that devolved Parliament than it was 14 years ago.
However, we are not debating that principle today, nor the principle of independence, but the organisation of a referendum and the legal authority for it. In the 1990s and, after devolution, in the first decade of this century, I vehemently opposed the idea that there should be a referendum on independence because I believed that the uncertainty that it would create would be harmful for Scotland. However, we are in new circumstances and it is absolutely right that we now have that vote, which will decide Scotland’s future. It is time to make that decision, following the outcome of the Scottish elections last year and given the political situation in which we now find ourselves. I supported the Prime Minister last January in his announcement that he wished to see the Scottish Parliament have the legal authority to conduct a referendum and that he was prepared to enter into negotiations to secure that outcome. I supported that position enthusiastically. I thought it was the right thing to do on principle and in practice—a binding referendum is good for everyone.
However, in my view, that referendum has to be based on transparent financing and fair rules, and should have been held without delay. I made a submission to that effect to both the UK Government and the Scottish Government last March. In particular, I say again—I hope the Electoral Commission is listening—that I advocated that we should not have a single question. It is not that we should have two different questions on two different topics but that the question itself—I think the noble Lord, Lord Steel, has made this same point—should be two distinct statements, from which voters are allowed to choose: either Scotland as an independent country or Scotland as a member of the United Kingdom.
That said, we are in a different place today, and I believe strongly in the principle of respect between the United Kingdom Government here in London and the Government in Edinburgh. That agreement has to involve our being willing today to criticise the outcome of these negotiations, but also respect the fact that the Prime Minister and the First Minister have shaken hands on the deal.
I do not want to go back over all the points that have been made but, as others have said, the outcome is that the delay in this referendum will cost Scotland jobs. No one should be in any doubt about that whatever. I have met companies in the United Kingdom, North America and elsewhere that are already delaying decisions about whether to invest in Scotland. They will delay even more between now and the autumn of 2014. The way in which the UK Government agreed to the Scottish Government putting this vote off until late 2014 was a grave error by both Governments that will cost the people of Scotland and the Scottish economy dearly, not just for the next 18 months but for years to come after that.
I do not want to repeat points that were made earlier, but on the rules, an additional point is that this referendum will be divisive enough in Scotland without having rules that are perceived by one side or the other to be unfair. One can already see prominent and reasonable people in public life tearing each other apart, with relationships and friendships breaking down. This will happen increasingly over the next 18 months. To add to that any perception that the referendum is unfair or conducted with unfair rules will, in the aftermath, leave a sour taste in the mouth that will take years to overcome in Scotland, and lead to a lack of acceptance of the outcome unless it is very decisive.
I understand the point that the Government are making. The principle of devolving the legislative authority means that we will devolve the detailed decision-making as well. However I do not think it was politically impossible to strike a deal openly and transparently between all concerned in advance of this legal authority being devolved, which would have secured more details here and now. For perhaps the very first time in the 30 or so years that I have known him, the noble Lord, Lord Forsyth, and I strongly agree on that point. I suspect we will not make a habit of it. I understand that he will not press his amendments, but at the same time I think he is wrong even to suggest that we should undermine the agreement that has been reached between the Prime Minister and the First Minister.
When I was First Minister I never really had a position on whether the detailed discussions that took place between me, the Prime Minister and his colleagues should become public or not. Therefore people are perhaps not aware of when we agreed or disagreed, and when agreements were implemented or not implemented. However, there is nothing worse for those who lead Parliaments than to be in a situation in which they strike deals with other leaders but are then undermined in their negotiating position and their ability to implement it. Whatever feelings there are towards this agreement, we need to respect the fact that a deal was done, they shook hands and we now have to get on with the debate. To undermine that would leave an impression of bad faith that would be damaging for the devolution settlement as well as for the referendum campaign itself.
We should endorse the order, but we should express very clearly to the Government that the next time they negotiate with the Scottish Government, they need to negotiate much harder. However, we also need to get on with this debate. We need to make the case that, after 300 or so years—in this month when we celebrate the amazing contribution that Scotland made to the union, which we joined back in the 18th century—it is time to celebrate that and have a positive campaign. That campaign should spell out the dangers but also the hope that exists if we retain our membership of the United Kingdom and do so decisively, putting this whole debate—this division that has plagued us for decades—behind us once and for all.
Lord Nickson
My Lords, perhaps I may make three brief points. I am disappointed on two counts. It is quite right that the noble Lord, Lord Forsyth, is not taking us through the Lobby, but after his inspiring and marvellous speech, it is a disappointment to me that I cannot go through the Lobby behind him to support him. It was one of the great speeches on an issue of huge importance to us all and it has been nobly supported on this side.
It is a slight disappointment and surprise to me that no one from the Constitution Committee of this House, which has produced the report on the agreement, has come to speak in the debate. The report is in the Printed Paper Office. I shall give way to the noble Lord, Lord Crickhowell, and it is wonderful to see him. I shall not delay him for more than a few seconds.
Many of us in this Chamber, and many who are not currently in the Chamber, attended a meeting this morning by courtesy of the noble Lord, Lord Astor of Hever, and the Minister for the Armed Forces. The meeting was about defence. It was an extremely useful meeting. Many noble Lords who are here in the Chamber made extraordinarily important points. I should like to highlight two of them. One was that it would be extremely helpful if similar meetings could take place with the other great departments of state on the other issues involved. The second was that it would be a very good thing if there was more identification of leadership from No. 10 and the Prime Minister on the Better Together campaign.
I should like to draw the attention of the House to the CBI document, The Scottish Government’s Independence White Paper, which came out this week. It lists questions on all the issues to which Members of this House would want to draw attention and provides an encyclopaedic examination for the SNP and Alex Salmond. I commend the document to the House because it covers all the questions to which we seek answers. I look forward very much to hearing the noble Lord, Lord Crickhowell.
Lord Crickhowell
Encouraged by the noble Lord who has just spoken, I should like to take the opportunity as a member of the Constitution Committee to put on the record of this Chamber some of the important points that we made in the report that we published on 13 November, a report that has been freely quoted today both by my noble friend and by others.
We made it clear that the Section 30 route that we are taking, rather than using primary legislation at Westminster, has a number of significant constitutional and legal consequences. As we can see all too clearly, and as the report states, it,
“significantly curtails the opportunity of the UK Parliament to have an effective input into the process. The Agreement was negotiated in private between the UK and Scottish Governments … There was no debate in either House of the UK Parliament on the Agreement until after it had been finalised”.
And, as we are learning very painfully this week, we said that,
“neither the House of Commons, the House of Lords, nor the Scottish Parliament will be able to amend the Order”.
We stated at paragraph 21:
“The House may consider that, despite the constitutional significance of the draft section 30 Order, the procedure makes it impossible to ensure fully effective scrutiny … It is hard to avoid the conclusion that more could have been done to include the United Kingdom Parliament in this process”.
We then made a crucial point:
“Neither the draft section 30 Order nor any other part of the Agreement stipulates what the referendum question is to be. This will be”—
as we have learnt—
“a matter for the Scottish Government to propose and for the Scottish Parliament to determine”.
Lord Sutherland of Houndwood
My Lords, I very much welcome the opportunity given by the noble Lord, Lord Forsyth, to debate this issue. He is right to take the view that he has on the amendment and on whether it will be pressed. However, this is a very important debate and, as has been suggested, we must ensure that it is continued.
I want to make two points and then issue a challenge. The first point is about the question. I was invited by the three pro-union—as it turned out then—parties in Scotland to chair a small, expert group on proposing a question that would meet the criteria which we all accept. We had hoped that it would be a group invited by all four of the major parties in the Scottish Parliament, but the SNP declined to nominate someone. Such is the way of life.
We came up with a question that is rather different from the one the Scottish Government propose—different in two respects that have already been commented on. First, we rejected the rubric, “Do you agree?” Rather, we wanted a single statement, “Scotland should be an independent state”: either “yes” or “no”, or “I agree” or “I disagree”. That would very plainly settle the matter.
The second point was, of course, that we used the word “state” and not “country”. The point of the word “state” is that if you have a state, you must have a head of state, a constitution, and foreign relations—whether with the EU or with NATO or, in due course, with the Government in Westminster, not least because of your interest in the Bank of England.
It was suggested to us—we have offered this evidence to the Electoral Commission—that the word “state” is a bit complicated. However, I believe in the electorate. They will take account of what this means. It is not a technical term. As a country, we host the Commonwealth Games; as a nation, we play in the Five, or is it Six, Nations tournament; as a state, we have a constitution, a head of state and, more than that, we must have foreign relations that we negotiate with others. If one says that the electorate will not understand that difference, then they will not produce informed consent or informed dissent. It is up to those of us who are involved in this, and, for example, the wider press, to explain the differences and ensure that people understand what they are voting on. So that is the question. We have submitted that evidence to the Electoral Commission. I do not know whether it will accept it.
My next point relates to the role of the Electoral Commission. The noble and learned Lord, Lord Wallace, slipped from one phrase to another. He suggested that in previous referenda there was a question of responding to the advice of the Electoral Commission. It is one thing to respond and accept—which is the phrase he used—but he also used another phrase: that the advice was accepted in line with what the Electoral Commission said. Are they required to go in the general direction, or are they accepting the actual advice?
In the light of that, I want to finish with a challenge. Much has been made of the role of the Scottish Parliament in this. I challenge the Scottish Parliament to debate now, before the advice is out. It must say whether it will accept the advice of the Electoral Commission, and if not, say so—and say why, or why not. Then, at least, we will have the arguments and reasons laid out for the Scottish population to understand what kind of group this is. The Scottish Parliament is not the Scottish Government; it is not the SNP. I challenge it now to debate a Motion that it will or will not accept the advice of the Electoral Commission.
Lord Browne of Ladyton
My Lords, I am content to be associated with the challenge of the noble Lord, Lord Sutherland, to the Scottish Parliament and I am delighted to follow him. The earlier part of his contribution, in which he went through the elements of the proposed question and the criticisms that his expert group had made of it, was helpful and instructive. It complemented nicely the contribution of the noble Lord, Lord Crickhowell, who spoke with the authority of the Constitution Committee and its helpful report.
That report, although properly directed to a Minister of the UK Government, should really be directed to the Electoral Commission. The fact that the Constitution Committee of this House, with its modest resources, although it has a very distinguished membership, produced such an authoritative and well argued report in a comparatively short time reinforces the criticism from the noble Lord, Lord Forsyth, that the Electoral Commission, with all its significant resources, could not produce a report on the same issue in a time that was in step with the important decisions that needed to be made in relation to the process of this referendum.
It will be of no surprise to the noble Lord, Lord Forsyth, that even were he to divide the House, I would not have voted for his amendment. That is not because he is not a powerful advocate—he knows the view that I hold of his ability to make an argument—but for the reasons that my noble friend Lord Reid of Cardowan set out. I just think it would be bad politics at this stage in this process to support such an amendment to the Motion before the House. That is not to say that I do not have a lot of sympathy with many of the arguments that the noble Lord rehearsed, and which have been reflected in other contributions.
As I am speaking so late in the debate, I am in the fortunate position of not needing to repeat many of the points about the question, the role of the Electoral Commission or expenses. There is both the amount of expenses that the Electoral Commission proposes to allow for the conduct of the referendum and the fact that it appears that we have allowed foreign money to interfere with our domestic politics, contrary to everything that I think we would all agree on about not allowing that to happen. There are people taking advantage of that to bring in foreign money to influence significantly the conduct of this decision in Scotland. I say to the noble and learned Lord, Lord Wallace, that if our regulatory legislation on the conduct of elections has such an obvious lacuna in it that we are allowing foreign money to be used in this way to affect political decisions in this country, it is incumbent on us quickly to close that loophole. As it appears that it is planned that the referendum will take place in late 2014, we have the time to do that. If we can do something to achieve the closing of a lacuna in our electoral regulations to stop this happening, it is incumbent on us to do it. We all agree that we should not allow foreign money to be used in this way and should do something about it.
I intend to concentrate on a small number of points which I think are genuinely additional to what we have already heard. My first point is in support of the noble and learned Lord’s argument that this is being done properly in devolving the power to the Scottish Parliament. I was interested in the irony of the argument that my noble friend Lord Reid of Cardowan deployed for this: the analogy of those leaving the club being entitled to make this decision for themselves, while those who stay and want to change the rules have to do that with everybody in the club. I may be wrong, but I think the first time I heard that analogy was when it was deployed by the noble Lord, Lord Forsyth of Drumlean, in making the argument that there should be only one question in this referendum and that if we went on to the issue of devolution max—a phrase that has slipped away from this debate, thank goodness—that was a matter for everybody in the United Kingdom, not just one for the people of Scotland, and that it therefore had no part in this referendum. I agreed with him then. The noble Lord, Lord Forsyth, may be sitting there thinking that there is a degree of irony that this argument was deployed so skilfully by my noble friend Lord Reid to undermine the argument that the noble Lord was making.
However, there is an additional argument as to why it is right, in the circumstances that we find ourselves in politically and democratically, that we should devolve this power to the Scottish Parliament. The current Scottish Government won an overwhelming majority, a majority that overwhelmed all of the other unionist parties in the Scottish Parliament in 2011 on a manifesto that pledged to deliver a referendum on the issue of independence. Of course we can say that was beyond the competence of that Parliament and we can make all these clever arguments, but actually we were left with a democratic problem. The answer to that problem—we have to face up to the political reality of that—is to give the Scottish Parliament the power to run this and then deal with the issues in that context.
My second point is about the way in which we are proceeding. I agree with all of the points that the Constitution Committee has made, which are essentially criticisms of the way in which the Edinburgh agreement was concluded and presented and the lack of parliamentary involvement, scrutiny and engagement in that. But that agreement has now been made. We have to decide whether to respect that agreement made by the UK government leadership and the leadership of the Scottish Government. We have chosen to respect it, and I think that is right. It appears that we have here an order that we have a role to play in, which is what we are doing now. We also have an interesting constitutional linkage between the order and the agreement, the status of which appears to be a matter of dispute. I say that because I understand that the principal legal adviser to the Scottish Government is describing the agreement in a very particular way that is in contradiction to the way in which it is being described here. What is the legal status of the Edinburgh agreement? Can it be used by those who seek now to use it as some sort of legal platform to allow them to do other things, or is it, to paraphrase what the Secretary of State for Scotland said, simply an agreement between the UK Government and the Scottish Government as to how the referendum is to be run?
That leads me on to my third point, which is directly about the question. I will be astonished, as I think everybody will be, if the Electoral Commission does other than advise the Scottish Government that the draft question that they have proposed is inappropriate and will have to be changed quite radically, for all of the reasons that we have heard. The noble Lord, Lord Forsyth of Drumlean, in an excellent speech, described it as a misleading question. The fundamental problem with it, from my point of view, is not that it is misleading but that it is leading—leading in the way in which lawyers deploy that word: it is a question that begs its answer. A question that can instinctively be answered yes, as the noble Lord, Lord Stephen, suggested, is a leading question. In certain parts of the conduct of legal proceedings, we have a history and a tradition of not allowing those sorts of questions to be asked because they lead the witness to an answer. We do that for the very good reason that in certain circumstances, when people are engaged in that kind of a relationship with an interrogator, they incline to say what the person wants to hear. So it is a leading question, and I cannot for the life of me believe that the Electoral Commission will say that it is an acceptable question.
The real issue is whether the combination of this order and the agreement that the UK Government have extracted from the Scottish Government lead to the Scottish Government putting before the Parliament that they control effectively a proposal in a Bill for a question that reflects the advice that the Electoral Commission has given. In other words, will they respond properly to that advice? Whether we can have confidence that the man who leads the Government at the moment can be trusted to do that or not, we need to know that there is some form of audit or enforcement of that process that goes beyond our ability to be able, at some future election, to make the nationalists pay the price for what they did then, as the noble Lord, Lord Forsyth, said.
In those circumstances, is it legitimate to consider that a refusal to take that advice and an insistence on a question—a question which the Electoral Commission said was entirely inappropriate and leading and misleading for that reason—is reviewable in a legal sense in the light of the agreement that the Scottish Government have entered into with the UK Government? I ask that not because I am such a clever lawyer that I have worked it out for myself, but because I had an informal conversation with one of the leading legal brains in this country, whom I will not identify, who suggested to me that such a decision would be reviewable. If there is a preponderance of that view among other leading lawyers in the United Kingdom, that will be enough to ensure that the Scottish Government behave in the way in which we want them to.
That is an example of exactly the sort of thing that it is quite legitimate for us as politicians and the UK Government to be exploring publicly in this environment. When we debated the Scotland Bill we had concerns about what the Government would agree with the Scottish Government. We set them off, in a sense, with a mandate not to do certain things. They have to be congratulated on coming back and meeting a substantial part of that mandate. The noble and learned Lord who will be responding to this debate deserves a significant degree of credit. The way in which he conducted himself in the early stages of this controversy, particularly the speech he made at the University of Glasgow, changed the whole tenor of the debate in Scotland. He carefully and calmly pointed out the legal basis of the powers of the Scottish Parliament and of the UK Government in the devolution settlement. He did the same thing on Scotland’s potential membership of the European Union, in a speech he skilfully gave in Edinburgh, and changed the debate.
However, there are still some issues for which we could use the same sort of devices to shift in a way that would allow us to have the confidence that this referendum would be legal, fair and decisive when it is conducted.
Lord Forsyth of Drumlean
I am not a lawyer and I wonder whether the noble Lord might give me some free legal advice. I asked my noble and learned friend why the Edinburgh agreement was not linked to the order. Perhaps naively, I assumed that it was to avoid any litigation. This whole process was started on the basis of trying to get a legal base that would avoid any legal challenges interrupting the process. Is the noble Lord arguing that there would be the opportunity for litigation if it was linked, or is he arguing that there might be an opportunity even if it was not linked?
Lord Browne of Ladyton
There is at least an issue worth exploring as to whether, with the current arrangement of an agreement—a public agreement, which raises a level of expectation—and the order, if the Scottish Government behave in a particular way, the decision to do so might be judicially reviewable. I do not look forward to the prospect of getting bogged down in litigation which might end up in the Supreme Court, for the obvious reasons of the relationship between the Supreme Court and the Scottish Government. I do not want to resurrect all that, but if there is something in this—I think there may be—the very fact that it is being aired in the public domain with reliable, informed and trustworthy legal advice, such as the sort of advice that the noble and learned Lord, Lord Wallace, gave publicly on previous issues of controversy, could well settle these issues so that we could have confidence that we were moving forward. That is my point.
My final point is that at one stage not too long ago we were led to believe that the UK Government would deploy their resources in such a way that we would get a series of papers that would set out their view on the implications of independence for Scotland and its separation from the rest of the United Kingdom. That information is crucially important to the debate. I hope the noble and learned Lord, Lord Wallace, will take the opportunity when he replies to the debate to indicate to the House where we are in the expectation of that. We know that the Scottish Government are deploying all of their resources towards the objective of a yes vote in the referendum in 2014. There is no reason at all why the UK Government, whose policy is to keep the United Kingdom together, should not deploy extra resources in order to achieve that objective. We should be utterly open about that. The sooner the Government are able to do that, to disaggregate that information from the information that only they hold for the rest of us to be able to deploy in this debate, the better. I am delighted that we have this order now because we are getting to the meat of the issue. I am desperate to get to the meat of the issue, but I want to be in a position where I can make arguments that are convincing.
The Duke of Montrose
My Lords, I would like to touch on three points, first on process, then on content and finally on effect. I want to go back a bit further than we have done so far this afternoon. Today we are dealing with one of the myriad Henry VIII powers that are contained in the Scotland Act. As your Lordships will know, the Act itself was almost exclusively the product of an ad hoc body that called itself the Scottish Constitutional Convention. The fact that it contains so many Henry VIII powers, it seems to me, was the product of an approach that said, “We don’t really know what we eventually want, but let’s make a start and then we can see how it works as we go along”. So far, the Library tells me, Governments of whatever persuasion have been able to unearth 31 powers in the Act and pass 194 amendments to Schedule 5.
Given the state of politics in Scotland, contrary to the expectations of all the wise constitutionalists who set things in motion, the Scottish Nationalists have achieved such an overall majority that the need for a referendum on independence has developed a certain urgency. That need is to determine what the true convictions of the Scottish people are.
The power contained in Section 30(2) is possibly the most far-reaching in the Act. As was pointed out in the report of your Lordships’ Constitution Committee, as we heard earlier, this power has already been used 10 times for things that varied from equality and human rights to the railways. As the noble Lord, Lord Crickhowell, said, the committee also commented that the use of,
“the section 30 route significantly curtails the opportunity of the UK Parliament to have an effective input into the process”.
Today we are asked to pass this outwardly fairly simple order. Noble Lords will notice that it shares one outstanding feature with the Scotland Act 2012. Both are remarkable for what they do not say. This time we have got rather more in the memorandum of agreement, but here we are being asked to pass measures that are not even as yet in secondary legislation. Noble Lords have touched on reducing the voting age to 16, an issue that is bound to have repercussions on all elections that take place in the UK, whatever anyone likes to say. In fact a Bill has been tabled in this House by the noble Lord, Lord Tyler, who I see is not in his place, when we will be able to look at this issue in the round. Here the issue is tucked away in a memorandum of agreement and we will not spend much time considering it.
The fact that we now find ourselves in a country with a devolved franchise, which is nominally giving restricted powers to other parts of the United Kingdom, appears to mean that the sovereignty of the Westminster Parliament can no longer be adhered to. We get framework orders such as this that are merely to approve powers that the Government have already assumed for themselves. Perhaps the Minister would like to comment on the Government’s statement in answer to one of Monday’s amendments to the Electoral Registration and Administration Bill. The amendment asked that the Secretary of State should be able to alter the franchise for elections by secondary legislation. The Minister said that they,
“believe that the franchise for UK elections should remain set out in primary legislation. It would be very unusual to provide for a change to the franchise in secondary legislation”.—[Official Report, 14/1/13; col. 489.]
What about memorandums of agreement? The agreement is such that we have a considerable—
Lord Wallace of Tankerness
Rather than allow a misunderstanding to continue, a memorandum of agreement does not change the franchise for the Scottish election. If it were to be changed, that would have to be done by means of primary legislation in the Scottish Parliament. Every referendum has its own franchise. The consequence of passing this order is that the franchise would be determined by the Scottish Parliament. There is an agreement that it should first and foremost be the franchise for Scottish elections and local elections. If the Scottish Government wish to extend it to 16 and 17 year-olds, that will require primary legislation in the Scottish Parliament.
The Duke of Montrose
I thank my noble and learned friend for that clarification but the underlying issue still bears consideration. On independence, I think that what we are faced with is that some regard Scottish history as having been a wasted opportunity either after Flodden in 1513 or after the Darien scheme in 1698, and they wish to wipe the record clean and begin again with a new and enlightened polity—centuries of Scottish toil brushed carelessly aside.
We can all see that in the intervening period there have been some remarkable individual Scots whose lives have marked moments of great progress for mankind, including Adam Smith, the framers of the United States constitution and David Livingstone. They can all stand on their own merit but in some ways, backing up the remarks made by the noble Lord, Lord McConnell of Glenscorrodale, when we begin to consider what Scotland’s contribution has been in the wider world, the vast bulk of it has been achieved within the union that is the United Kingdom.
Of course, as we contemplate the accumulation of events—the noble Lord, Lord Reid of Cardowan, raised the same issue—we are now learning that perhaps some of the elements were far from activities of which we should be proud. Overall, though, I maintain that Scotland has much to show for those years, and it is not something that can be easily shrugged off in a moment of enthusiasm for whatever appears new.
The nature of Scotland is such that big opportunities generally have been seen in the wider world outside. We can all see that independence can have a great attraction to the stay-at-home Scots, as long as Alex Salmond can continue to pull in sufficient funds to maintain the level of what we have come to regard as our inalienable rights. However, what can a vote for independence offer to our young people who are pursuing a career path in the corridors of power or in more widespread and influential businesses and marketplaces, or those who wish to establish businesses there? Will they not have to accept that they will be even more regarded as non-nationals in their place of work and increasingly unable to have a vote and influence in what is still their home?
Lord Foulkes of Cumnock
Perhaps I may follow the noble Duke, the Duke of Montrose, who has spoken so elegantly, as always, in this debate, as I did on a number of occasions during the passage of the Scotland Bill. Perhaps I may inform Members of this House, not all of whom may be au fait with social media, that this debate is being very well covered. Already the key comments made by the noble Lord, Lord Forsyth, and my noble friends Lord McConnell and Lord Robertson have appeared on Twitter. That is a very interesting development, and I shall return to that.
The Scottish Government appear to want—I think that we have to be very careful about the words that we use, as I said to the noble Lord, Lord Forsyth, in an intervention—to manipulate the way in which things will turn out in this referendum. It is very important to indicate clearly that separation is very different from any kind of devolution. As shown in the recent somewhat confusing vote regarding membership of NATO, the Scottish Government are going out of their way, in wanting to keep the Queen and in hoping to keep the pound, to try to make it appear that this separation, which will be drastic and irreversible, is no different from the vote that we had on devolution. It is completely different and we must keep saying that.
I referred to funding in an intervention, and I hope that we will get a reply. Again, there seems to be an attempt to manipulate or to try to make sure that the outcome moves in a particular direction, with funding coming from all sorts of sources for the yes campaign, particularly from overseas. We need to know that there will be a ruling, not advice, and to know exactly what the ruling will be and who will make it, so that there will be a level playing field.
Another issue that has appeared in social media—it was reported on Twitter—was that Alex Salmond said today, in an interview on Radio 4:
“The first job of the Scottish Parliament would be forming a constitution”.
There is a misunderstanding of what would happen in the event of a yes vote, on which I think almost all of us here agree, although the noble Lord, Lord Wigley, has not spoken yet. An assumption is being made—an impression is being created—by the supporters of the yes vote that there would suddenly be independence. I hope that the Minister will indicate that it would be a long and difficult process in relation to issues such as the national debt and a whole range of others that will have to be negotiated.
A separate Scottish state could not be created until there had been legislation in this United Kingdom Parliament. Surely, there would have to be further legislation before there could be a separate Scottish state. The referendum is not enough. The detail would have to be worked out. There would have to be negotiations. Some people have suggested, and I hope that the Minister will comment on this, that there might need to be a further referendum on the acceptance of the negotiations at the end of that. I am not sure if that would be the position but it certainly seems arguable that that could be the position.
My main point relates to the report by the Select Committee on the Constitution, mentioned by the noble Lord, Lord Crickhowell. It covered a number of points. Paragraph 27 of the report states:
“It may be, therefore, that irrespective of the legal status of the MoA as a whole, different provisions within the MoA are capable of generating different levels or different kinds of legal or constitutional obligations or expectations”.
Paragraph 28 states:
“It cannot safely be said that the arrangements proposed put the matter beyond all legal challenge”.
My noble friend Lord Browne has already raised the question of legal challenge in relation to the wording of the question. I hope that the former Lord Chancellor, the noble and learned Lord, Lord Mackay, does not mind my saying, but earlier I had the opportunity of discussing this matter with him and he indicated that there may be options of legal challenge here as well. I do not think that it should be used as a threat in any way but we should alert people, the public generally and elected Members of the Scottish Parliament and the Scottish Government, to the dangers of that kind of thing.
Lord Crickhowell
While this question was left in the air, we were conscious that at the very least it might be another cause for substantial delay while the legal question was settled.
Lord Foulkes of Cumnock
I think that that has reinforced the point.
I also want to raise the question of 16 and 17 year-olds, as I have done on a number of occasions. I do not think that people have realised—and certainly the Scottish Government have not realised—the practical problems of identifying and putting these 16 and 17 year-olds on the register. It has been estimated that there may only be a few thousand who are ultimately eligible to vote. We should ask the Scottish Government to tell us how they are going to do this. It has already been made clear that they will have to undertake and fund it; we should ask them how they are going to carry it out.
Finally, one particular problem is that there is so much preoccupation with the referendum by the Scottish Government, the First Minister and Deputy First Minister, by members of the Scottish Cabinet and SNP Members of the Scottish Parliament—they are so preoccupied with the run-up to it and winning it—that other areas that we have devolved to them are being ignored. The health service is not being properly supervised and problems have already been raised. Some of our Labour colleagues in the Scottish Parliament have brought up these concerns. In education, housing, and social work, problems have been raised that are not being properly addressed. We should say to Members of the Scottish Parliament, and particularly to the Scottish Government, that a whole series of very important matters has been devolved to them and they should not let their preoccupation with the referendum and with trying to win it take their attention away from doing a good job in the areas already devolved.
Lord Steel of Aikwood
My Lords, when my noble friend Lord Forsyth began his speech he said to my noble friend the Minister that if he were on a charge of murder he would happily employ my noble friend as his defence counsel. I hope my noble friend is honing his skills because they may be needed. I get the impression that my noble friend Lord Forsyth has a completely unhealthy obsession with the First Minister of Scotland, and it is not one that I share. It may go back to the fact that they were at university together, but I thought that his otherwise powerful speech was spoilt by too many references to one individual of whom we should not be afraid.
Lord Forsyth of Drumlean
I am certainly not obsessed with the First Minister but I think it is legitimate to point out that when my noble friend talks about the Scottish Parliament and so on, we all know that the Scottish Parliament is completely dominated by the First Minister. None of the members of the SNP is able to say a word but by his leave. So it is important to realise that, when we think we are devolving power to the Scottish Parliament, we are talking about giving power to Alex Salmond because he calls the shots.
Lord Steel of Aikwood
My noble friend has just repeated the point I am trying to make—that he is totally obsessed by one individual. I agree with the noble Lord, Lord Browne, who pointed out that, whether we like it or not, the SNP secured the democratic mandate and this order enables it to carry that out and to hold the referendum. For that reason I support the order.
There are lessons to be learnt from the mistake—the misjudgment—that has been made to keep postponing the process to 2014. This has been mentioned by several other speakers. It is important to notice the difference between this situation and the one in Quebec: during the two years that we have been debating this issue, the support for independence has been going down, not up. This is extremely significant. I suggest that the reason it has been going down is that, quite apart from the 35 questions from the CBI which the noble Lord, Lord Nickson, referred to, there have been three major issues on which the Scottish Government have been found wanting. One already referred to is the legal advice—or rather lack of it—on joining the European Union.
I remember the SNP campaigning very strongly on independence in Europe—in other words, it was not only going to join the European Union, it was also going to sign up to the euro. That has suddenly disappeared: I cannot think why. The SNP is no longer advocating joining the euro. That uncertainty about the relationship of a future independent Scotland with the European Union—on which there was an interesting, long interview this morning on Radio 4—is one of the reasons why support has slowly withered away. The second reason, which is related to it—
Lord Reid of Cardowan
Will my noble friend give way? He has helpfully reminded me that there is another implication of that slogan, of course, because just as you can be independent in Europe you can be independent in the United Kingdom. What you are not is separate, which reinforces the points that we made earlier on.
Lord Steel of Aikwood
Indeed, I was going on to say that one of the other uncertainties that has been exposed during this prolonged debate is the question of what currency would be used. If the euro is out, and we are not having a separate Scottish pound because we are going to rely on the Bank of England, what sort of independence is that? So the second bit of unravelling has been on the whole issue of the financing of an independent Scotland.
The third—which has also been mentioned by others so I will not go into detail—is on Trident and the defence role of an independent Scotland. My party and I have long been opposed to the replacement of the Trident system—in fact we were opposed to the initial replacement of Polaris by Trident. That is at least a position of principle, even if people disagree with it. What is unacceptable is for the SNP to say, “We want rid of Trident, but we are quite happy if it goes to Devonport or Barrow-in-Furness or somewhere else”. That is not a credible position. Nor is the position, as the noble Lord, Lord Reid, pointed out earlier, of saying, “We would like to join NATO because that makes people feel comfortable, but we will not accept any of the obligations of joining”.
For all these reasons, the longer the debate has gone on—and I have argued before that that was a mistake because people would become bored by it and the uncertainty would not be good for Scotland nor for investment in Scotland—the more the support for independence has declined.
Among those of us who campaigned in the 1980s and 1990s for the restoration of the Scottish Parliament, there was an unspoken assumption that, if we got a Scottish Parliament and a Scottish Government, then the future Scottish Government and the future UK Government would collaborate in the interests of the people of Scotland. Indeed, it is fair to say that, in the first years of devolution, that did happen. Of course there were disagreements occasionally between the two Governments but basically they were both pursuing the best interests of the people of Scotland. I think the biggest single reason why support for independence has declined is that that does not appear to be the position of the SNP Government. Their position is not, “What can we do together with the UK Government to better the life of the people of Scotland?” It is rather, “What can we do to promote the SNP?”. That is a very different position.
During the Olympic Games, the Scottish Government hired the Army and Navy Club in London, at a cost of £400,000 of our taxpayers’ money, to entertain athletes and others visiting the Games: in fact, very few people went. They could have had Dover House for nothing—a substantial building, right in the centre of London, well known—but of course it belonged to the UK Government, so it did not suit the ideal of the SNP. That is a trivial example of what I am saying—that the motivation throughout has been what is in the best interests of the SNP.
I end with the question that everybody else has been raising about the decision on respecting the judgment of the Electoral Commission. Why is the SNP not willing to say now that it will accept that judgment? It is because it wants to promote the interests of the SNP. The more people realise this, the more the support for independence will continue to decline.
I support this order. I am not complacent about the outcome but I am confident that, because of this constant shifting of position by the Scottish Government, in the end people will say that they do not want to make that leap in the dark.
Lord Wigley
My Lords, every voice that we have heard so far has been a unionist voice. I realise that I may be in a small minority—perhaps even a minority of one—in this Chamber in wishing the people of Scotland well in their quest for independence; none the less, I wish to see a new relationship between the nations of these islands: a new partnership of free and equal self-governing nations co-operating with each other and with partners in the European Union and the wider world.
Today’s debate has involved a series of attacks on the SNP in general and on Alex Salmond in particular, as was mentioned by the noble Lord, Lord Steel of Aikwood, a moment ago. It may well cross the minds of noble Lords that it is a little strange that this House—one of the two Houses of the UK Parliament—does not have any voices from Scotland that represent nationalist aspirations, which is, after all, the driving force behind the forthcoming independence referendum.
I fully understand that the SNP has stuck resolutely to a policy of not putting forward nominations officially in the party name—as indeed did my party, Plaid Cymru, until five years ago. The experiences that my party suffered at the hands of a former Prime Minister may well have persuaded the SNP, which might be sympathetic to securing a voice in this Chamber, not to bother pursuing the matter. Noble Lords may well wish to ponder on the acceptability of a system whereby the leader of one party—albeit a Prime Minister—can determine whether another party, with MPs in the House of Commons, can be denied a voice in one of the two Chambers of the British Parliament.
Lord McConnell of Glenscorrodale
I hope that the noble Lord, Lord Wigley, will accept that the only responsibility for this situation lies with the Scottish National Party itself. Many of us have argued that there should be representation in this Chamber. In particular, I have argued that Mr George Reid, the Presiding Officer who succeeded the noble Lord, Lord Steel, and who worked with me when I was First Minister, would be an excellent Member of this Chamber. However, because he rightly feels some loyalty to his former party and that party will not put him forward, he is not sitting here. That is wrong, but the responsibility for it lies entirely with the nationalist party, which will not make that decision.
Lord Wigley
I hear what the noble Lord says. Indications that I have had from Mr George Reid may be slightly different from the interpretation that the noble Lord has given. However, I have no doubt whatever that there were those within nationalist Scotland—not necessarily even members of the SNP—who would have been willing to serve the interests of their country in this House. Be that as it may, the fact that they are not here and therefore cannot participate in this debate is unfortunate. That is why I am contributing, although I have no authority to speak on behalf of the SNP and I certainly would not presume to do so. It is not for someone from Wales to tell the Scottish people what is best for them; nor indeed is it for those from England or Northern Ireland to do so. The decision on whether Scotland should be an independent country lies with the people of Scotland and Scotland alone. I am glad that the draft order before us today arises from the Edinburgh agreement, whereby it will be the Scottish Parliament and not Westminster that determines the date, franchise, question, referendum rules and campaign spending limits. The proposed arrangements for the referendum will be initiated by the Scottish Parliament. The Electoral Commission will then have an opportunity to give its views, and those views will be duly considered by the Scottish Parliament before a final decision is taken. That is the implication of the Edinburgh agreement.
I noted one important point in today’s debate relating to Scottish servicemen based overseas. I know that there are SNP MPs and MEPs who are also actively aware of this and I very much hope that a resolution of the issue can be found.
As I understand it, the resolution in the Scottish Parliament supporting this order was passed unanimously by that Parliament. I also understand that every one of the Westminster parties supports the order. This shows how Governments can work together to achieve a sensible outcome, and I believe that it is to the credit of both the Government of Scotland and the Government of the UK that this has been achieved. It is an indication that Governments can, indeed, work together harmoniously. I have no doubt that if Scotland becomes an independent country as a result of the referendum, there will be equally harmonious co-operation between the Governments in London and Edinburgh thereafter. There has been talk today of litigation and judicial reviews but that sits a little uneasily with the type of co-operation that I have just described.
It is truly excellent that there should be such co-operation and that the referendum will be seen as “Made in Scotland”. That gives greater confidence that the outcome, whichever way it goes, will be acceptable to all the Scottish people as a democratic decision taken by the Scottish nation. I am sure that no one in this Chamber from outside Scotland would want to gainsay that or dispute the fact that this should be a decision for Scotland. To that extent, the noble Lord, Lord Reid, is quite correct that the referendum in Wales on providing further devolution is different from the question of independence and raises the question of whether referenda are really necessary for every small step of further devolution. That was not the case with the Scotland Act last year. There are, of course, implications for the rest of the United Kingdom, and no doubt these will be debated during the referendum campaign, as is right and proper. However, they are not issues that should delay the progress of the draft order before us today.
Lord Martin of Springburn
I agree with the noble Lord: we should not personalise this debate. The First Minister has a case to put the same as the rest of us, and we should not attack anyone—particularly the First Minister—on a personal basis.
Lord Wigley
I am very grateful to the noble Lord for that intervention. Certainly, not all speakers have done that. I noted the contribution of the noble Lord, Lord Browne, which was very constructive. It hit a tone that can help to ensure that there is no dispute on matters that are irrelevant to the central question. That central question is whether people want independence. No doubt there are arguments to be had on that and the other issues should be put to one side.
Lord Reid of Cardowan
I do not know whether the noble Lord is about to conclude but he has covered everything except one point. It is the main point here and concerns the nature of the question. Does he accept that under any referendum a leading question is an unfair premise on which to base a democratic decision?
Lord Wigley
Yes, of course, I accept that without reservation. The point is whether the question that has been proposed is a leading question, and there will be differences of opinion on that. I have no doubt that the Electoral Commission will give its opinion on the question and of course the Scottish Parliament will take considerable note of what the Electoral Commission says. It would be strange if it did not. However, to suggest that the Scottish Parliament or any Parliament should automatically accept the ruling of a body such as this takes the issue much further. If we were to argue that Westminster should automatically, under any circumstances, always accept the suggestions put forward by the Electoral Commission, irrespective of whether the Government or indeed the whole Parliament agreed with it, that would be unacceptable here, and I suggest that it would be unacceptable in the context of Scotland as well.
Lord Reid of Cardowan
With respect, the noble Lord has set up a straw man. I did not suggest that every recommendation should be accepted. I suggested that if the question is deemed by the arbitration body, which is neutral, to be a leading question, you should make it plain in advance that you will accept that particular piece of advice. The noble Lord says that no one should ever do it, but perhaps I may say that I would do it. If a referendum were being proposed by any Government, including a Labour Government, which the Electoral Commission said was being skewed by a leading question, I would accept the arbitration of the Electoral Commission. The noble Lord implied that he would as well if the question was denoted by a neutral body as a leading question. The question that we have been asking is why that cannot be done by the First Minister and the SNP in Scotland.
Lord Wigley
I am very grateful to the noble Lord. If indeed the Electoral Commission were to come out and say in categorical terms that this is a leading question and is totally unacceptable, and that that is clear cut in its opinion, then that opinion must be taken on board by the Scottish Parliament. I have no doubt that it would take good note of any such recommendation. I have faith in the democratic process in Scotland. However, to say that whatever the Electoral Commission says, the Scottish Parliament must accept its ruling as opposed to the decision of elected representatives, is surely one step too far. Be that as it may, I support the draft order that is before us today. I hope that the House will give it a unanimous backing so that we can move forward to the next stage of this process and, ultimately, secure a referendum, whatever the outcome, that is a credit to democracy.
Lord Cormack
My Lords, the noble Lord, Lord Wigley, whom I am very pleased to call a friend, said that his would probably be the only voice advocating independence. Mine appears to be the only English voice in this debate today. We have heard two from Wales and the rest from Scotland. I particularly wanted to take part because this is not a Scottish issue. This is an issue that affects the whole United Kingdom. As I have said in this House before, we all have varied backgrounds, and it is very difficult to isolate the pure Scottish from the pure English. I consider my identity as English, and yet the background of my family is Scottish for centuries. My elder son lives in Scotland with a Scottish wife, and my two grandchildren go to school in Edinburgh. My son considers himself Scottish, so Scottish indeed that he acted as the election agent for the daughter of the noble Lord, Lord Steel—because he has gone Lib Dem—in a recent election.
Lord Cormack
Yes, indeed, successfully. That, of course, in its simple way illustrates the fact that within this Chamber and within this country, there are very few of us who can say that we are wholly this, that or the other. It is therefore important that there be English voices in this debate. After all, England is by far the largest country in the union, and we will all be affected for generations to come if, on the anniversary of Bannockburn, the Scottish people vote to sever their links with the United Kingdom.
My noble friend Lord Forsyth made an absolutely splendid speech. He has been taken to task by one or two people for being too personal. I would like to dissociate myself from personal attacks but also to agree with the substance of what he said. I know Alex Salmond very well. I met him on the first day that he came into the other place. Quite by chance, my wife and I and our family found ourselves for successive years taking holidays on the beautiful island of Colonsay at the same time as Alex Salmond, and having many an agreeable conversation at the bar. He is an engaging man. Personally, he has many delightful qualities. However, he is one of the two most skilful politicians in the United Kingdom at the moment, the other being Boris Johnson. We underestimate his political skill, dexterity and ability at our peril. We must take him very seriously, and we cannot assume that the referendum will go the way that most of us in this Chamber would like it to go.
As I listened to my noble friend Lord Forsyth, and as he was almost convincing himself that he was wrong not to press this to a Division, so he was almost convincing me. Of course I accept his judgment and I will not attempt to divide the House. However, the agreement that was negotiated was not so much an agreement as a capitulation. The Prime Minister, for whom I have high regard, and the Secretary of State for Scotland had Mr Salmond running rings around them. They conceded far too much. It is a great pity that the Parliament of the United Kingdom in its two Houses will not have a greater say in these crucial decisions that will be taken. The Scottish Parliament will be judge and jury when it comes to deciding the question.
We all know what the question to the Scottish people is. It could be framed in the simple terms, “Do you wish to leave the United Kingdom?”. However, what is being proposed at the moment is certainly, as has been said, a leading question. It invites the answer that Mr Salmond would like. That is why over these next months—we have less than two years—it is important that the series of papers that has been referred to is produced not only by the British Government but by the cross-party alliance that is being spearheaded in Scotland by Mr Darling—an admirable choice, I believe. It must be spelt out to the Scottish people, whose decision this ultimately is—I am not one of those who advocates every citizen in the United Kingdom having a vote—just what they will be losing and what they will be leaving.
I was delighted that the question of the votes of Scottish service men and women, who serve our country, often in extremely dangerous circumstances, was brought up in this debate. They of all people, wherever they are temporarily domiciled, must have the opportunity to cast a vote on the future of the country for which they are prepared on a daily basis to lay down their lives.
It is going to be an extremely interesting and, I hope we can say, good-humoured period. However, the stakes are extremely high. The noble Lord, Lord McConnell, pointed to the dangers of bitterness creeping in. Of course, he did so with his background knowledge—knowledge that we all have—that of all wars, the bitterest are always civil wars. This will be a civil war of words, to a degree. It is crucially important that we try to keep it good-humoured. That is why, although it is right to talk about the political skills of our opponents, we do not seek to denigrate them personally as individuals.
I very much hope that there will be an opportunity during the coming 18 months for those of us who have Scottish links, Scottish roots and Scottish branches of our family to play a part in this debate. We need to say to the people of Scotland, “You are a fundamental and integral part of the United Kingdom, and we need you because we need each other”. The United Kingdom is far more than the sum of its individual parts, and there is no individual part that has made a greater contribution to our history and success as a nation than Scotland. We do not want to lose that.
There is no point in resurrecting all the arguments over devolution. I remember them well because I was in the House of Commons when the very first Scottish National Party Member, Donald Stewart of the Western Isles, came—he was a lovely man. I saw all this, and took part in debates in the early 1970s and throughout that decade. Big mistakes were made by both major political parties. The biggest mistake made by the Conservative Party was neglecting to recognise the reality of the first devolution vote. It failed because it did not clear a parliamentary hurdle but it indicated aspirations in the Scottish people. During those 18 years, I was one of a group who went to see Mrs Thatcher, as she then was, to beg that something be done: perhaps we should start having the Scottish Grand Committee sitting in Scotland regularly and frequently; or there should be a consultative assembly of Scottish local authorities. Sadly, she did not want to listen. That was a great mistake.
I will never forget travelling up to Scotland on the sleeper and having a dram or two with Donald Dewar in 1996. I said, “What would have happened, Donald, if we had done that in 1979 or 1980?”. “You’d have shot our fox”, he said, “but it’s far too late now”. We are, as they say, where we are. We have a United Kingdom. There are cracks and fractures and it is our duty collectively to repair them. I am sorry that the order is phrased as it is. I am sorry that so many concessions have been made, but those of us who believe in the United Kingdom all have a duty to fight for its integrity in the year ahead.
Lord Kerr of Kinlochard
My Lords, my view of the Edinburgh agreement is closer to the noble Lord’s than that of the noble Lord, Lord Stephen. I scored the Edinburgh agreement a three-to-one win to the First Minister of Scotland. He seemed to lose on the number of questions but he won on the franchise, which is not a very important point; he won on the date, a more important point; and he won on the big point, which is the question itself. It is to that issue that I want to come back. I shall follow what was said by the noble Lords, Lord Sutherland of Houndwood and Lord Browne of Ladyton, and ask the Minister for a view on the internal wording of the Edinburgh agreement and its significance. I am referring to paragraphs 8 and 12.
In paragraph 8 we are told:
“Consistent with provisions in PPERA”,
the Electoral Commission will review the wording for its intelligibility. I do not know why these words are there but they worry me. Paragraph 12 has a straightforward reference to the PPERA, which gives the Electoral Commission responsibility for,
“commenting on the wording of the referendum question”.
What is the remit given to the Electoral Commission? The Constitution Committee’s excellent report—I am grateful to the noble Lord, Lord Crickhowell, for reading from it—shows that that committee, too, is nervous on that point. It says:
“We trust and believe that the Electoral Commission will be rigorous in assessing the question and will give candid and fearless advice on the wording proposed by the Scottish Government”.
It says that,
“the Electoral Commission will consider whether the referendum question … presents the options clearly, simply and neutrally … we would expect any departure from the Electoral Commission’s recommendations on the wording of the question to be robustly scrutinised. We hope that there will be no such departure”.
I share all those sentiments, obviously.
Why is the word “intelligibility” there? Why is it necessary to have the narrower definition of the role of the Electoral Commission? It is easy to envisage a question that is completely intelligible but also leading or misleading. I am nervous about the role of the Electoral Commission in this respect. I do not want to exaggerate the point. It would be resolved if the challenge of the noble Lord, Lord Sutherland, were accepted. We need to know the view of the Edinburgh Parliament in principle on what it would do—not when it has seen the language but its view of the language produced by the Electoral Commission.
Lord Crickhowell
The noble Lord’s question is particularly apposite as to why this limited reference was made when one considers that the Electoral Commission in 2009 set out the referendum question assessment guidelines, which included:
“Is the question written in neutral language, avoiding words that suggest a judgement or opinion, either explicitly or implicitly?”.
That takes it much further than the question that has just been raised by the noble Lord.
Lord Kerr of Kinlochard
That is precisely the point that I am trying to make. Is the reference to “intelligibility” in some way limited to it or could it be construed in a court of law as in some way limiting the normal role of the Electoral Commission and its role envisaged in 2009?
Lord Elystan-Morgan
Is not the agreement made between the Prime Minister and the Scottish First Minister a gentleman’s agreement? It is not an international treaty, which can be made only between sovereign states. Although everything that the noble Lord says has every relevance in the moral context, in terms of legal consequence and strict constitutionality it must be the case that it is no more and no less than a gentleman’s agreement, binding, of course, as it is.
Lord Kerr of Kinlochard
That is where I was going, although I would like to hear the Minister’s answer to my question on how one reads paragraphs 8 and 12 together.
Lord Wallace of Tankerness
I wonder whether it would be helpful to do so now, as it has been raised. The word “intelligibility” is used because Section 104(2) of the Political Parties, Elections and Referendums Act 2000, passed by this Parliament, states, in relation to a referendum question, that the Electoral Commission,
“shall consider the wording of the referendum question, and shall publish a statement of any views of the Commission as to the intelligibility of that question”.
That is why the word, “intelligibility” has been taken from the statute and put into the memorandum. As the noble Lord rightly points out, the Electoral Commission set out in its 2009 guidance and guidelines, which I quoted when moving the Motion, how it intends to go about determining intelligibility. I hope that that clarifies why the word was used. The other matters to which the noble Lord referred, such as ease of understanding, lack of ambiguity and avoiding misleading voters, are part of the criteria that the Electoral Commission has indicated that it applies when undertaking the word, “intelligibility” in statute.
Lord Kerr of Kinlochard
I am grateful to the Minister and in some way reassured. It seems to me that we need to keep a close eye on this issue. I strongly agree with the challenge raised by the noble Lord, Lord Sutherland, but I think in his normal, consensual, non-polemical way, the noble Lord, Lord Reid of Cardowan, got it absolutely right. There may be a fox around, but the Scots are not chickens. They are not stupid. If there is an attempt to rig the question, and the advice from the Electoral Commission, speaking to its remit as described by the Minister, is dodged or not responded to positively, it would be a considerable down side with the electorate in Scotland. The question of the question is very important, but let us not exaggerate it. If it is not a straight question the Scots are even more likely to give it a very straight answer.
Baroness Liddell of Coatdyke
My Lords, I rise at this stage in the debate because a woman always likes to get, if not the last word, at least something near to that and it has been a singularly male debate so far. I make that point quite deliberately. If you look at the polling in Scotland, you will discover that, in the course of this debate about separation, women have increasingly become in favour of the union and men have remained static. Whether that is about “Braveheart” or the football, I do not know. The other side of the coin is that women are concerned about jobs and their children’s future. They recognise that there are always those who suffer when there is divorce—and what we are talking about is divorce.
Let me be blunt. If the First Minister thought that there was a majority for the break-up of Britain, the referendum would have taken place by now. We proved in 1997, with the devolution referendum, how quickly a referendum could be done. What the First Minister is counting on is either boredom on the part of the electorate—and there is a very strong chance that that will happen—or complacency on the part of those who favour the union. That has been commented on a couple of times this evening. There is a risk of complacency. I am fed up with taxi drivers telling me that there is no way Scotland is going to vote for the break up of Britain. There is an assumption that it is in the bag. It is not.
During the Scotland Bill deliberations in this House, I said—and I am not one for quoting myself but I quite like this quote—that we wanted a referendum without jiggery-pokery. As the noble Lord, Lord Forsyth, laid out in his excellent speech, what we are discussing this evening is the potential for jiggery-pokery. We have had a bit of it before—and this is not a personal attack. We have had obfuscation on the question of the legal basis of Scotland’s role in Europe; we have had a situation where Hansard in the Scottish Parliament has been altered; and we have had misleading figures given on further education, to name but three examples. This is a critical decision for Scotland and a critical decision for the rest of the United Kingdom. We owe it to all of the people of these islands to make sure that it is done on a sound and sustainable basis so that the day after the referendum each one of us can turn around and say that we won or we lost, and the other side accepts the decision.
I support much of what the noble Lord, Lord Forsyth, has said. I could not have followed him into the Lobby this evening, so I am glad he is not testing the opinion of the House, because I believe it would have led to delay. We have heard about the situation in Quebec, and I acknowledge what the noble Lord, Lord Steel, has said about the separation support going down, but a week is a long time in politics. Who knows what will happen between now and the referendum in 2014? It is critically important that we put aside petty divisions on these issues, which are much too big for the future of this country.
One very important issue that was raised by the noble Lords, Lord Reid and Lord Cormack, and others, is the question of allowing the vote to be made available to those in our Armed Forces. I do not know how they did it in 1945; they must have found a way to do it in 1945. Surely, it is not beyond the wit of a sophisticated democracy to find a way of giving our soldiers, men and women alike, the opportunity to vote in 2014, the year that marks the centenary of the First World War, when many of our families went to fight for a United Kingdom.
The challenge with the order that exists for us is to acknowledge, as a number of us have, that we should have been given an opportunity to debate these matters in this House. It should be recognised that we are a partnership. Those of us who sit in this House are unelected Members—but many of us have served our time at the other end of the corridor and have come from different parts of civil society in this country. We are entitled to a voice, and our colleagues at the other end of the corridor have a democratic right to that voice. It is unfortunate that they were not given that opportunity. I would say, particularly to the noble Lord, Lord Stephen, that the Prime Minister was either naive or misadvised in the terms that he agreed to in the Edinburgh agreement. The opportunity to get an agreement that allowed for no jiggery-pokery was there, and I am afraid that he dropped the ball—and it is not often that I use sporting analogies.
Lord Pearson of Rannoch
My Lords, I sense that the mood of your Lordships is to move towards the Front Bench speeches, so I shall speak briefly. I congratulate the noble Lord, Lord Forsyth, on another brilliant performance; I think he said it all. However, out of what he and other noble Lords have said, I would like to put two simple questions clearly to the Minister, as it will save me interrupting him when he comes to wind up.
Why did the Government not wait for the advice of the Electoral Commission before they brought forward this order? What was the hurry? Secondly, do the Government agree that the leading question, “Do you agree that Scotland should be an independent country?”, which other noble Lords have quoted, is not an acceptable question to put to the Scottish people?
Finally, I understand that for many Scottish politicians the whole prospect of a referendum and independence for Scotland is very agreeable to their political ambition and hubris. However, I fear that independence may have a very unhappy result for the people of Scotland. Therefore, I can only rely on the faith that I have in the Scottish people that they will not be that easily bamboozled when the time comes.
The Earl of Mar and Kellie
My Lords, very briefly, and by way of introduction, I believe the referendum will lead to Scotland becoming a better democracy. The process we are involved in at the present moment, and the fact that the Edinburgh agreement was signed in Edinburgh, is a great improvement on what happened in 1921 after a ceasefire in July and fraught negotiations in Downing Street led to a treaty that people probably did not want to sign. The Westminster Parliament has made progress.
I am also mindful of the fact that the original treaty negotiations were held in London in the summer of 1706, and it is a curious phenomenon but the two sides were not allowed to meet. They had to negotiate from separate rooms, sending messengers to each other. We should make certain that we do not remain in that position. At the present moment, listening to the debate, it does slightly sound as though this House wants to talk to the Scottish Parliament without meeting its Members. I hope we can continue to make progress towards proper democratic discussion.
Lord Empey
My Lords, the noble Earl is concerned that people only met at a later stage in separate rooms. People in negotiations that I have been involved in have been in separate nations, separate continents and different places before we actually got together, so we are well versed in “proximity talks”, which I think was the phraseology that was invented to cover those circumstances.
We seem in this country, of late, to have developed referendumitis, because we are looking at a whole series of them now. Indeed, later this week, we may be offered a menu for further referenda. Not wishing to be outdone by the noble Lord, Lord Cormack, the sole English contributor to this debate, I felt it appropriate for my part of the world to make a few comments, because, as noble Lords have said throughout the debate, all of us would be affected one way or the other. However, the most important thing is that we are a union with component parts, and there is no doubt in my mind that the people of Scotland have a right to choose. The job of this Parliament is to ensure that the choice is fair and that the options are put to them clearly, as has been said many times before.
I will just deal with the order, because noble Lords will all have great sympathy with much of what the noble Lord, Lord Forsyth of Drumlean, has said today. However, I think that the noble Lord, Lord McConnell of Glenscorrodale, who is not in his place at the moment, put his finger on it. Whether we like it or not and whether this Parliament has had enough time to debate it or not—and I think it has not—the fact is that the Prime Minister and the First Minister have shaken hands. Quite frankly, any departure from that at this stage would have cataclysmic results on the implications and how that would be spun in the circumstances. It is done, and whether we like it or not, we have to work with it.
I will also deal with the point of breakdown. When we had our referendum—nearly 15 years ago, believe it or not—I had the task of being co-ordinator for the Ulster Unionist Party’s “yes” campaign. Not only were communities divided but so were families—husbands, wives, sons and daughters—and some of those scars have not yet healed. Let us be under no illusions but that the tone in which the debate is conducted is going to very important for the long-term relationships. People keep telling us today of the implications of the miners’ strike and the differences that arose there, and I know that both communities and individuals remained very divided.
Questions of this nature are extremely divisive, and constitutional questions, certainly where I come from, are exceptionally divisive. What we are witnessing at home at the moment is terribly sad. Sadly, Mr Gerry Adams of Sinn Fein, in his new year message, as reinforced in an article yesterday, is now trying to promote a referendum in Northern Ireland. Under the Belfast agreement, the only question, effectively, is, “Do you wish to be part of a united Ireland?”. Putting that particular, most divisive, issue front and centre as your main campaign for the next few years running up to 2016—the 100th anniversary of the rebellion in Dublin—is irresponsible to say the least in the present circumstances. When we should be talking about our economy and trying to get young people into work, I would have thought that talking about a referendum is the last place anybody wants to be. I deeply regret that.
With regard to complacency, I strongly endorse what the noble Baroness, Lady Liddell, has just said. If you have a 50% turnout, 33% can be 66%. You will get differential turnouts; I have seen it happen. If one side of the argument feels, “Ach, well it will be all right on the night”, but the diehards on whatever side of the argument come out, the percentages in an opinion poll are almost an irrelevance. It is who turns out on the day that matters.
I share the concerns about intelligibility and all these sorts of things. These arguments go over people’s heads. We have had three terms used in this debate already: “country”, “state” and “nation”. If you go and ask somebody for a definition, we all slip in and out of that language in our own parlance. As an Ulsterman looking across the channel at Scotland, to me, Scotland is a country. It has to be a country; if it were not, it would be part of the amorphous landmass of Great Britain. If it is not a country, why does it have its own law, traditions and different languages? Why does it have a history of attitudes, religion and a pioneering spirit and all that goes with that? Of course it is a country. I also think it is an independent country, because it has all those things, which define a country. However, if we get into an argument with somebody in the street about whether a country and a state are two different things, and if we have to go to the door arguing and trying to explain the difference between those things, I fear we are in some difficulty.
All I can say, with the experience that we have had, is that this will be divisive. We have to try to keep the best humour possible, as the noble Lord, Lord Cormack, said, but not underestimating the downsides and implications—and try to keep the argument as simple as possible. I sincerely hope that the people of Scotland will choose to remain within the union, because it would have huge implications for us if they did not. It is their decision, and I respect that, but the playing field has to be level, with nobody manipulating it, and the question asked has to be a genuine question that makes it clear that they are seceding from the United Kingdom. Anything less than that will leave an argument. There are still people in Northern Ireland today who do not accept the referendum result that we had, even though it was won with 71.5%. Because of our cross-community issues, people say, “Oh, well not enough of this group voted or of that group”. I can think of nothing worse or more corrosive than an argument over the process. I sincerely wish the people of Scotland well, but sincerely hope that the Government do not allow anybody to wipe their eye in the months ahead.
The Earl of Caithness
My Lords, as the noble Lord, Lord Empey, has said, words are important, and I come back to this word “independent”, or “independence”. I agree with my noble friend Lord Forsyth—on the hypothetical question that the Scottish Government would like to pose, I would very much like to vote yes because Scotland is, to me, an independent country now within part of the UK. I have been banging on about the use of the words “separate” and “separatism” rather than “independence”, and must ask my noble friend why the Government have used “independence” in the order. Proposed new Section 5A, under Article 3 of the order, refers to,
“the independence of Scotland from the rest of the United Kingdom”.
That only encourages the Scottish Government to continue using “independence” rather than “separation”. Why are the Government using that wording rather than saying, “Separate from the rest of the United Kingdom”? That would make what we are all talking about and what the Scottish Government actually mean much clearer.
I also echo what the noble Lord, Lord Pearson of Rannoch, said. I have been longing to ask the question, “Why have we got this order now?”. My noble friend Lord Forsyth said that the Electoral Commission has told him it needs 12 weeks to study the question and formulate its reply. That is in only three weeks’ time, but so much of this debate has been about what the Electoral Commission might have said or might not say. Why have we brought it forward this time? It has been a huge disservice to Parliament, and we have not had the sort of debate that we could have had. It leads one to ask the question put by the noble Lord, Lord Browne. If the Electoral Commission says, “No, that is a leading question”, what are the legal remedies if the Scottish Government persist with their proposed question?
Lord McAvoy
My Lords, this has been quite a lengthy debate. Nevertheless, the contributions have been very weighty; there is much knowledge and wisdom in this House. I would like to draw your Lordships’ House back to why we are here. We are here because the Scottish National Party won an electoral mandate at the previous Scottish parliamentary election. I do not like it but I accept the result. It has the right to support and advocate a referendum. We in the Labour Party support this order and hope to get into the debate as soon as possible, rather than be distracted by the many issues that have been raised today.
The noble Duke, the Duke of Montrose, mentioned an ad hoc organisation that advocated devolution. The Labour Party, the Liberal Democrat Party, and almost the whole of civic Scotland joined that ad hoc organisation. The difference between what happened then and what is happening now is that there was a broad consensus throughout Scotland about the need for a Scottish Parliament. The Labour Party supported that and, with the help of the Liberals and others, we brought about devolution and the installation of a Scottish Parliament. As soon as you devolve power to the Scottish Parliament, that power is there and it would be foolish to argue and quibble about this and that when it clearly has a mandate and the democratic right to do what they are doing, within generally accepted conventions.
A number of your Lordships have mentioned, quite rightly, the flaws within the deal that came about between the Prime Minister and the First Minister. We feel that one or two things could have been negotiated a bit more firmly. Having said that, the deal has been made, that is what we have, and we should move on from that. Nevertheless, we should note some points. For instance, the Scottish Affairs Committee quite rightly said in its report last week that decisions in the Scottish Parliament should be achieved by consensus and not simply through the use of the SNP’s majority. I keep hearing the phrase “gold standard”. The consensus that we achieved in the 1980s over the issue of the governance of Scotland should surely be the gold standard. I do not want to denigrate anyone’s personality on this, because that is a distraction that will only damage the cause of those of us who support the union.
There are a lot of issues, such as that of granting votes to 16 and 17 year-olds. The Scottish Parliament has the power to do that. There should be a debate about it, but it should not be an issue that prevents or distracts us from scrutinising this order.
On campaign finance and the wording of the question, the key phrase should be that the Scottish Government cannot be the referee and a player. Surely the Electoral Commission will act as an independent overseer of that process?
The point so ably made by my noble friend Lord Reid of Cardowan is that the Scottish people are not exactly backward at coming forward. I do not think we will be easily fooled; we will spot any chicanery or jiggery-pokery that may come from any party during this process. Sometimes, we in the political world can underestimate the acumen of the public, who keep an eye on politicians.
The wording of the question should be clear, unambiguous and thoroughly tested by the Electoral Commission. Like others, I should like to see the Scottish National Party commit itself to accepting the decision of the Electoral Commission vis-à-vis the wording. The noble Lord, Lord Empey, and other noble Lords who mentioned this were right: if we have bitter disputes over this, the bitterness will continue and the result will not be regarded as legitimate. It is absolutely essential that we get legitimacy for that result, whatever it is, and that it should be accepted by all.
A number of your Lordships have rightly mentioned the quality of the contribution and amendments of the noble Lord, Lord Forsyth. A number of my colleagues have stated they agree with much of his position. As I am a bit of a bureaucrat, one of the things I am concerned about is the practicality of the timeline. It is clear that, although October 2014 seems a long time away, the processes that need to be gone through before then are nevertheless considerable and time-consuming. If any of these timeline targets are not met, the process will be delayed, which would be dangerous. It will seem that obstruction by Westminster has caused the delay, which would be fatal to the cause of those of us who support the union.
Devolution means devolution. I am afraid that is sometimes hard to accept and something that we do not like. The Scottish people decided that they wanted devolution. I accept it, and it should be accepted.
My noble friend Lady Liddell made the point—far better than I am making it so far—by warning that we should not allow ourselves to be distracted by all the niggly points that have annoyed us. We have picked fault here and picked fault there. I do not say that the niggles, doubts and criticisms are not justified, but let us solve them; let us deal with them, get them out of the way and get on with campaigning. The people of Scotland are looking for a campaign where the issues are discussed, not individual personalities. We can then go to the real core of what would happen to Scotland if it separated from the rest of the United Kingdom. I do not mean that as a negative point or to frighten the people of Scotland by saying that Scotland cannot or would not exist without the rest of the United Kingdom. Of course we could: we could be economically viable and we could be a separate state. But we should say to people that we do not want to be separate—to separate from England, Wales and Northern Ireland, a union that has served us all well, especially in two world wars.
Again, I echo my noble friend Baroness Liddell. Let us get these issues dealt with. Yes, let us deal with them and debate them, but the sooner we get on to this campaign the better.
Lord Wallace of Tankerness
My Lords, I thank all those who have taken part in this debate. I thank also my noble friend Lord Forsyth for moving his amendment which has stimulated so much debate, although I suspect that, even without it, we would have had a considerable debate on the issue. I understand from my noble friend Lady Garden that there have been some 20 contributions, including an Englishman, a Welshman, a Northern Irishman and, regrettably, only one woman.
Lord Wallace of Tankerness
I offer my sincere apologies to my noble friend Lord Crickhowell. It has been a very passionate debate. As the noble Lord, Lord McAvoy, said, this is not necessarily where we want to be. I do not think that anyone here has advocated a referendum or, certainly, independence. Nevertheless, we recognise and respect the outcome of the Scottish election of May 2011 and the manifesto commitment of the Scottish National Party to have a referendum.
I welcome the fact that the noble Lord, Lord Browne, supported the view that the process was being done properly. I thank my noble friend Lord Crickhowell as a member of the Constitution Committee for his contribution. I am grateful not just for the most recent report of that committee on this matter but for the report which the committee produced in February last year following the consultation which the United Kingdom Government launched. In that report, the Constitution Committee welcomed the proposal,
“that a section 30 order be made to confer on the Scottish Parliament clear competence to legislate for a referendum on Scottish independence”.
From that flow a number of the issues which have been dealt with in this debate. It is also fair to point out that, in its most recent report on the referendum, the committee stated:
“We welcome the fact that the Agreement reached between the two Governments accords with our previous recommendations. The question of legislative competence is addressed, it is intended that the referendum will pose a single question on independence, and the Electoral Commission will play the lead role in advising on the referendum”.
That is why I cannot accept the argument that the outcome of the negotiations was weak, as it has been described by some noble Lords. As the Scottish Affairs Select Committee in the House of Commons said:
“The Secretary of State and his team are to be congratulated on their willingness to compromise and reach a consensus with the Scottish Government so that the referendum can be held on a basis to which all can consent”.
The noble Lord, Lord McConnell, mentioned the evidence that he gave to both the United Kingdom Government’s consultation and the Scottish Government’s consultation, where he said:
“I hope that both the Scottish Government and the UK Government will be willing to compromise on all of the key issues to ensure we have a clear outcome in a referendum and an outcome that is accepted by everyone as the fair result of a fair campaign”.
That is what we sought to do.
The noble Lord, Lord Reid, said, quite fairly, that of huge significance was the fact that it was a single question. I would certainly find myself in some difficulty if I was to come before the House today trying to defend an order or a process that had led to an outcome where there could be more than one question—the so-called multi-option referendum. As the noble Lord rightly said, there is a world of difference between a referendum where one part of the United Kingdom wishes to secede from the United Kingdom, which is a matter, as successive Governments have accepted, for that part of the United Kingdom, and one where there is to be a different relationship within the United Kingdom, with further powers being devolved. That is an important distinction and it is why I am very glad indeed that what we bring before the House today is an order which will provide for a single-question referendum.
It is inevitable in these circumstances that we come to the role of the Electoral Commission. The noble Lord, Lord Kerr, asked about the wording in paragraph 8 of the agreement, which contains the reference to “intelligibility”. I hope that I indicated why that word was used—it is a statutory word, if you like—but of equal importance is the way in which that has been interpreted by the Electoral Commission. Mr John McCormick, who is the Electoral Commissioner for Scotland, said on 9 November, when the Scottish Government submitted their question:
“We will assess the referendum question to see whether voters find it clear, simple and neutral. If it isn’t, we’ll say what needs to be done”.
I shall come to the issue of the question in a moment, because the other issue, as my noble friend Lord Crickhowell said, is the role of the Electoral Commission. Paragraph 12 of the agreement, also referred to by the noble Lord, Lord Kerr, sets out the role of the Electoral Commission in referendums. It states:
“Both governments agree on the importance of the referendum being overseen in an impartial way by bodies that can command the confidence of both sides of the campaign. The Electoral Commission is responsible for overseeing referendums held under PPERA. PPERA gives the Electoral Commission responsibility for: commenting on the wording of the referendum question; registration of campaigners; designating lead campaign organisations; regulating campaign spending and donations; giving grants to lead campaign organisations; publishing guidance for permitted participants; reporting on the referendum process; the conduct of the poll; and the announcement of the result”.
Paragraph 14 of the agreement states:
“Both governments agree that the Electoral Commission should fulfil all these functions in respect of the independence referendum, with the exception of the conduct of the poll”—
which will be done by an electoral management board which has already been established for local elections in Scotland and it is widely agreed across that parties that that should continue—
“and announcement of the result, and the giving of grants”.
The reason why the giving of grants is excluded is that the Scottish Government propose that there will be no grants of public money to the lead campaigns. That is the nature of the oversight by the Electoral Commission which has been proposed.
On foreign donations, it is proposed—
Lord Forsyth of Drumlean
Before the noble and learned Lord leaves the topic of the Electoral Commission—
Lord Forsyth of Drumlean
Well, perhaps, when he comes back to it, he can answer the question whether it was ever part of the British Government’s negotiating position to require the Scottish Government to accept the advice of the Electoral Commission on the question.
Lord Wallace of Tankerness
I certainly intend to deal with that. It is a fair question which has been echoed across the Chamber in this debate.
Donations from overseas are dealt with by paragraph 28 of the agreement, which indicates that the rules under PPERA will apply. PPERA states that donations of more than £7,500 must be recorded and declared publicly and that donations of more than £500 require individuals to be registered in the United Kingdom. It is intended that these rules will apply in this referendum and the agreement has set that out. In other words, it is the same rules as are agreed under PPERA.
Lord Foulkes of Cumnock
Does that mean that more than £500 can be donated to the campaign from people in England?
Lord Wallace of Tankerness
I understand that that would be the case, yes.
My noble friend Lord Forsyth asked why broadcasting and mailshots were included in the order whereas other issues were not. The simple answer to that is that broadcasting and the Royal Mail are outwith the competence of the Scottish Parliament. Legislation brought forward by the Scottish Parliament cannot deal with these issues unless competence has been transferred. That particular part of the order transfers competence in order for the broadcasting arrangements and mailshots to be dealt with.
My noble friend and many other noble Lords asked about the nature of the question. Numerous people have found flaws with the question of whether Scotland is a country, a state or a nation, as the noble Lord, Lord Sutherland, made clear. I do not stand here to defend the question that has been put forward. It is not my job to defend it; nor would I wish to defend it. It is important that that should be a matter for the Electoral Commission, which is why it has been asked to advise.
The United Kingdom Government recognised in their consultation paper that the Electoral Commission’s role in referendums was to consult on the intelligibility of the proposed question and to report to the UK Parliament. We would have come under considerable pressure and criticism if it had been suggested that the Scottish Parliament should be treated in a different way. I will pick up on this point, because it is quite central to a lot that has been said in this debate. I will not go into the personalities, but we know the ability of not only the leader of the Scottish National Party, but in many ways the Scottish National Party itself. One thing that they have quite excelled at—those of us who have been around Scottish politics know this only too well—is their ability to nurse a grievance and to milk a grievance. That is what the noble Lord, Lord McAvoy, said about the timing of this. We do not want to give them another sense of grievance. If we had proposed that the Scottish Parliament was in some way to be treated in a lesser way with regard to a question after it had gone to the Electoral Commission than the United Kingdom Parliament was treated, we would have given them cause for a grievance.
The noble Lord, Lord Reid, was absolutely right to point out that this is a question which will come back to haunt them if they choose to ignore the advice of the Electoral Commission. I know that my noble friend Lord Forsyth said that he did not want this to be two years of picking on points, but it would be quite legitimate, if an attempt was made to put a biased question, for that to be pointed out and for the political consequences of that to be reaped. However, I would not wish, and what we have sought to avoid—and have successfully sought to avoid—is a two-year campaign in which the United Kingdom Government and Parliament are in the dock because we somehow or another have tried to rig the referendum. That is why it is so crucially important that we do not give, and we have not given, any opportunity for the Scottish Government to cry foul and say that we are somehow rigging the situation.
In an interesting article by John Rentoul in the Independent in November of last year, in which he praised my right honourable friend the Secretary of State for Scotland, he said:
“This sudden removal of the London Government from the see-saw meant that Salmond lost his balance. When Cameron went to Edinburgh in February to announce that he would not try to stop the Scottish National Party holding a referendum, Salmond found that the great London counterweight, against which his career had been built, had been taken away”.
It is important that we do not give that opportunity, or that excuse, for a grievance to be mounted. That is one of the main reasons—a key reason—why we are dealing with this in the same way as we would deal with a question in a UK referendum that had been legislated for by the UK Parliament.
That answers the question about the referee and the player. I take the point made by the noble Lord, Lord Sutherland, who came forward with a question himself. It is up to people with an interest to make their views on this known to the Electoral Commission. Clearly it would not be appropriate from the Dispatch Box to determine the agenda of the Scottish Parliament, but I rather hope that Members of the Scottish Parliament will note what has been said about them having an opportunity to debate this issue.
I will make one further point on this, which was made by the noble Lord, Lord McConnell, and was echoed by the noble Lord, Lord Empey. Lots of harsh words could, and almost certainly will be, exchanged in the next two years, and there is potential, as the noble Lord, Lord McConnell, said, for a nasty taste to be left in the mouth. That is why there is a responsibility on the Scottish Government and the Scottish Parliament to ensure that the question that is asked is not a source of that sour taste in the mouth. Just as we have sought, as a United Kingdom Government and a United Kingdom Parliament, to produce a scheme and process that will not allow anyone at the end of the day to cry foul—“It wasnae fair”—it is also incumbent on the Scottish Government and, above all, on the Scottish Parliament to ensure that when they devise the rules, procedures and indeed the questions for this referendum, they do not give anyone the opportunity at the end of the day to say “It wasnae fair”. It is important that the outcome of this referendum is decisive and properly recognised as having been fair and properly arrived at by the people of Scotland when they cast their votes in 2014.
Lord Pearson of Rannoch
My Lords, is the Minister about to leave the Electoral Commission in his remarks, or will he address the two questions that I, and the noble Earl, Lord Caithness, put to him?
Lord Wallace of Tankerness
I had indicated that I would not defend the question that had been put forward. It would be appropriate for the Electoral Commission to indicate that. I was asked about time; as was indicated by the noble Lord, Lord McAvoy, there is a timeline. My noble friend Lord Forsyth suggested that the legislation for the referendum would not come until after the White Paper. My understanding is that if this House, and subsequently, the Privy Council, approve the order next month, the Bill will be presented to the Scottish Parliament in March. The Bill cannot in fact be presented to the Scottish Parliament until such time as this order has been approved, which is why the timing of it is as it is.
The important point with regard to the question is that what has been done by this order, in transferring the legal competence to the Scottish Parliament, is such that the nature of the question and the advice of the Electoral Commission will go to the Scottish Parliament. It is not proper, and it would fuel that sense of grievance, if somehow or another we said “We’ll give you the competence to legislate for this, but only provided that we can write or prior-approve the question for you”. That would lead to a very strong sense of grievance, and would put us, who want to argue the case for our United Kingdom, on the back foot in many of the ensuing debates.
I very much hope that common sense will prevail, and that the sense of achieving a decisive outcome will prevail with the Scottish Government and Parliament. As the noble Lord, Lord Reid, indicated, they will pay a very serious political price if they do not do so.
Lord Forsyth of Drumlean
Does the Minister really mean that it was right for the Electoral Commission not to give its advice to this House and the other place on the intelligibility of the question proposed by the Scottish Parliament, and that it would be wrong for us to comment on it? If we had had the Electoral Commission’s advice today—it must be provided by 1 February—quite a long time would have been saved, because we would have known what the position was. Surely we have not got to the position where we are so afraid that what we are doing will be misrepresented that we cannot do our work. Of course we cannot decide the question, but surely it would have been entirely appropriate for us to have the opportunity to comment on the question in the light of the independent advice from the Electoral Commission.
Lord Wallace of Tankerness
My Lords, a number of questions are rolled up into that. First, that is not the obligation of the Electoral Commission—there is no statutory duty or anything else for it to provide the answer by 1 February. I cannot remember which noble Lords made the point that your Lordships’ Constitution Committee had produced a report in a relatively short period of time, so why could the Electoral Commission not do the same?
The task of the Electoral Commission, among other things, is to go out and sample the question, which is not something, with all due respect, that the Constitution Committee intended to do, and neither would we expect it to do so. There is, therefore, a piece of work to be done in testing the question for its intelligibility, whether it is leading or misleading, whether it is neutral or whether it can be understood by those who will be asked to answer it in the referendum. I do not believe, therefore, that there was somehow some obligation on the Electoral Commission to rush that. I can hear the criticisms now if people thought that it had in some way been rushed.
Neither my noble friend nor any other noble Lord will be inhibited from commenting on the report of the Electoral Commission, which will be published and very much in the public domain. I will come to the noble Lord, Lord Sutherland, in a moment. There is no doubt that it is a matter for the Scottish Parliament to determine. There will be every opportunity for voices to be expressed as to what the Scottish Parliament should do in the light of the advice from the Electoral Commission.
Lord Sutherland of Houndwood
Simply as a matter of fact, the Electoral Commission has advised me that it will publish its report early in February.
Lord Wallace of Tankerness
That is helpful. However, it is important to understand that there is a body of work that it ought to do, and is doing, before it publishes that advice.
The question has been raised about the franchise. As I indicated to my noble friend the Duke of Montrose, it is a matter of primary legislation for the Scottish Parliament. If it chooses to extend the franchise to 16 and 17 year-olds, issues will arise out of that; it will need to ensure that the proper protection is given to minors whose names would appear on a roll. That would be the responsibility of the Scottish Parliament in any legislation which it brings forward.
I do not believe that that is the thin end of the wedge. If only legislation passed by the Scottish Parliament was, we would have proportional representation by single transferable vote for English local authority elections, but I have not seen a great rush in the Westminster Parliament to follow the Scottish Parliament in that constitutional development
Several noble Lords, including the noble Lord, Lord Reid, my noble friends Lord Stephen and Lord Cormack, and the noble Baroness, Lady Liddell, posed an important question about the vote for service personnel. The position is that the members of the Armed Forces and their spouses or civil partners are entitled to vote in elections, provided that they are registered to vote either by means of a service declaration or as an ordinary voter. Members of the Armed Forces will be able to vote in the referendum if they are on the register in Scotland either as a result of an address in Scotland or a qualifying address showing a connection to Scotland, such as service accommodation in Scotland; an address in Scotland where they would be living if they were not in the services; or an address in Scotland where they have lived in the past. The same rules apply to spouses and civil partners of members of the Armed Forces.
On the specific point raised by the noble Baroness, Lady Liddell, service personnel who are overseas at the time of the referendum who would otherwise be eligible to vote will be able to vote by post or by proxy. I understand that the Electoral Commission and the Ministry of Defence run an annual electoral registration campaign to inform personnel and their families in units around the world about such voting matters. I will certainly talk to colleagues in the Ministry of Defence in the next round of prompting of information to ensure that they remind service personnel of the referendum.
Lord McConnell of Glenscorrodale
My Lords, will the Minister check very carefully that that information campaign is timed to coincide with the period during which service personnel would require to register to qualify to vote in 2014? The timescales may well be such that they would miss deadlines. We would all appreciate an assurance that such checking will happen.
Lord Wallace of Tankerness
That is an important point, and I take it on board. It is also important to make clear that service declaration, to which I referred, is now valid for five years, following legislation that took effect in March 2010. Those who have already made a service declaration which gets them on to the Scottish register will have that for the five years after March 2010, so they will certainly have it for the time of the referendum.
Lord Reid of Cardowan
I am grateful to the Minister for that. Knowing how bureaucracy can ensure that the best laid plans gang aft agley, can he ensure that there is a distinct recognition in the Ministry of Defence that this is different from the normal, annual registration, for this reason: you have go to every serviceman and woman? From what he said, there may well have to be a process to identify those who have the qualifying criteria of having had a residence in Scotland, and so forth. If that process is not started early, we will find, as we did many years ago, before we brought in the new regulations, that for purely bureaucratic reasons, servicemen and women and their families are not adequately informed—especially, as my noble friend Lord McConnell said, in time. That process has to start now. It is quite a big job weeding out, if you like, or identifying people, rather than applying a carte blanche regulation for everyone.
Lord Wallace of Tankerness
My Lords, the noble Lord makes an important point. I will certainly ensure that his comments and the general sense of the House is drawn to the attention to the Ministry of Defence. No doubt Questions can be asked to ensure that we live up to that.
Finally, my noble friend Lord Forsyth quite properly said that there should be no room for complacency. That was echoed by other noble Lords, including the noble Baroness, Lady Liddell, and the noble Lord, Lord Empey. I could not agree with them more. I have said—although I do not think it was from the Dispatch Box—that the biggest enemy that those of us who wish to remain part of the United Kingdom have is complacency. We must guard against it, not simply because I want to win—I want to win very convincingly indeed. I certainly take the point about differential turnout made by the noble Lord, Lord Empey, and very much believe that we should guard against complacency.
My noble friend Lord Forsyth and the noble Baroness, Lady Liddell, asked about information. I suspect that we will not get a completely neutral arbiter, although some bodies are producing evidence from a more neutral point of view. The noble Lord, Lord Nickson, who I think is a former chair of CBI Scotland, appropriately raised the pertinent questions that CBI Scotland is addressing to the Scottish Government.
The Government have made it clear that we will be publishing material to provide information, not least about the number of jobs provided by the defence industry and what benefits being part of the United Kingdom bring to Scottish security. It will also set out facts, which are perhaps currently unknown or often just taken for granted. In that regard, it will include the importance of our position in the world. Scotland is part of the United Kingdom which punches much above its weight in terms of our population and because of our history, to which Scotland has contributed. It will talk about the protection of our citizens. It will talk about the many economic benefits to the United Kingdom.
The first of those papers will be published in the next few weeks, and we will publish further papers throughout 2013. I hope that that brings important information, which we will all be able to use in our arguments for the furtherance of the United Kingdom.
My noble friend Lord Forsyth and I were both elected to the other place 30 years ago this year, and I have known him all that time. We have disagreed about a number of issues, not least Scotland’s constitutional future, but I have always respected where he comes from on that and the important issues that he has raised this afternoon. One issue on which we can join together is that it is very important that we join together people right across this Chamber who believe that Scotland is better as part of the United Kingdom and the United Kingdom is better with Scotland in it; that we share a common heritage; that we share common social bonds; that we have a shared cultural heritage with, fundamentally, shared political values; and that we can defend them much more effectively in an uncertain and challenging world when we are working together. It is in that spirit that I want to argue that case, and I urge your Lordships to approve the order.
Lord Forsyth of Drumlean
My Lords, what a wonderful debate we have had. It is pretty clear to me that there is a consensus in all parts of this Chamber— bar one, if I may say so—about the need to have a referendum campaign that is seen to be fairly conducted and where there is no dispute about the result at the end of the day.
As I said at the beginning, I do not propose to divide the House. I think that that would be a huge error on my part, because it might give the impression that we are not as united as we are on these matters. However, I say to my noble and learned friend—we have been friends for a long time, if opponents, which we are not now, although we were earlier in the week; it is very difficult to work out what the nomenclature of this week should be—that he has taken a risk, a gamble, on being able to ensure that we get a decent question and proper rules for the referendum. I am prepared to withdraw my amendment and back his judgment. If it turns out to be wrong, he can expect some very vigorous debates in future. I beg leave to withdraw my amendment.
Lord Forsyth of Drumlean
As an amendment to the Motion in the name of Lord Wallace of Tankerness, at end to insert “and regrets that debate in Parliament on the draft Order is taking place before the publication by the Electoral Commission of its advice on referendum campaign funding and on the proposal from the Scottish Government that the referendum question be ‘Do you agree that Scotland should be an independent country?’, advice which is required to be published by 1st February”.
Health: Medical Innovation
(11 years, 10 months ago)
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Lord Saatchi
To ask Her Majesty’s Government what steps it proposes to take to encourage best practice in medical innovation.
Lord Saatchi
My Lords, I express my gratitude to the usual channels for allowing the time for this debate. I have introduced the Medical Innovation Bill into your Lordships’ House. I will not be covering the details of that Bill in this debate; Second Reading will follow at some point in the year and we can discuss them then. However, this debate may illuminate the context of the Bill and give your Lordships’ House an opportunity to consider the whole complex question of what best practice is in innovation, particularly the application of research and knowledge to patient treatment.
In opening this debate among the judicial and medical experts in your Lordships’ House who have devoted a lifetime to this subject—compared to my own brutally short experience—a certain humility is appropriate. It will be my privilege to hear many noble Lords who are among the great innovators of our time. I particularly thank my noble friend and his team at the Department of Health for their wisdom; Dame Sally Davies, the Chief Medical Officer, for her viewpoint; the Secretary of State himself for making improved survival rates his key priority for healthcare; and the many patient groups, academics and practitioners who have contributed their thinking.
The Prime Minister himself has encouraged British medical innovation in the context of the global race, and the document on diffusion of innovation in the NHS by my noble friend, himself Minister for innovation, is, if he will allow me to say so, a model of agenda-setting by a government department.
Buoyed up by Bertrand Russell’s view that simplification is not always obfuscation and often serves to crystallise the issues, I will attempt first a simple description of the need, and then a specific suggestion of what steps your Lordships may consider to meet that need. I will concentrate on the most emotive word in the English language—cancer—and hope to draw wider conclusions from this area. To express the need, I am helped by an unexpected source, the Father of the House in another place. In his tribute to Her Majesty the Queen on the occasion of her Diamond Jubilee, he used a striking phrase:
“There is nothing more inspiriting in the whole world than a beautiful woman”.—[Official Report, 07/3/12; col. 852.]
I can amend that. There is no more distressing thing in the whole world than a beautiful woman being reduced to a sparrow.
Unfortunately, here is the status quo. A woman is told that her tests are “normal” and to come back in 12 months. She is removed from her home 12 months later and cut and drilled until she loses half her body weight. Wires and tubes are attached to her throat, nose, stomach and vagina. Drugs are given to her that cause nausea, vomiting, diarrhoea and fatigue. They open the path for fatal infections to enter the woman’s body and reduce her body’s defences against such infection. The woman is left for dead, and sooner or later the woman dies. The “process”, as it is called, involves scenes that would not be permitted in a Hollywood horror movie.
I hope that that is a fair description of the need for medical innovation. The screening techniques for such a cancer are inadequate; no reliable early detection method is available, and even if it was, it would improve the overall survival statistics but not the date of death. The treatment regimes, when provided—that is, the drugs, the cycles of their administration and the surgical procedures—are 40 years old. They are also ineffective; cancer quickly develops resistance. Not surprisingly, the survival rate for such cancers is the same as it was 40 years ago—in other words, nought; and the mortality rate is the same as it was 40 years ago—that is, 100%.
This disease is relentless, remorseless and merciless. Its treatment is medieval, degrading and ineffective. Why are we so forsaken? It is said that cancer is so complex that it is beyond the judgment and understanding of the human mind to comprehend its variables. Therefore, through ignorance, we kill people unnecessarily.
If that is true, it is not through lack of trying. Scholars in cancer have long sought general rules about the world as robust as the laws of physics and to verify statements, propositions and putative facts by the results of empirical studies. Unfortunately, it has not worked out quite like that. Instead, we find the stubborn fact that, after 2000 years of human progress, cancer is still outside Newton’s universe where physical laws govern reality.
In the natural sciences, even though, as Popper says, the closest approach to proof is just a succession of unsuccessful attempts at falsification, we can nevertheless make statements in the natural sciences, perhaps without finality but with a certain degree of probability. If I drop these papers, they will fall to the ground. Tomorrow the sun will rise. In cancer, though, the record seems to show that once we express opinions or beliefs or attempt to offer explanations, descriptions or predictions, then error, doubt and uncertainty come to the fore. In cancer you hear it said that, “Every case is different” and, “There is always hope”. Such well meaning sentiments are not science. There is no hope that if I drop my papers they will not fall. These statements are meant to bring cheer to the desperate, but instead the effect is the opposite. They bring despair—the dread revelation that cancer is a realm in which science has yet to achieve sovereignty.
In the end, all attempts to place cancer medicine within the canons of scientific objectivity have failed. There remains an irremediable tentativeness about the logically perplexing question of what is the cause or cure for cancer. Cancer science has not yet found its Newton. Why? There is a powerful deterrent to innovation at the heart of the current system. Economists would call it a systemic failure. Current law is a barrier to progress in curing cancer. Under present law, any deviation by a doctor from standard procedure is likely to result in a verdict of guilt for medical negligence. Current law defines medical negligence as deviation from standard procedure. As innovation is deviation, though, non-deviation is non-innovation. In this way, the fear of litigation for medical negligence is a roadblock to innovation in cancer treatment. The present pre-eminence in law of the standard procedure provides no inducement to progress. The self-interest of medical practitioners, as defined, for example, in doctors’ insurance policies, means that innovation—that is, deviation—is a form of self-harm.
In Clark v MacLennan, an important test case in 1983, the significance of departing from an approved mode of practice was treated by the trial judge, J Pain, as having the effect of reversing the burden of proof, so that once the plaintiff established a deviation the defendant had to disprove an inference of negligence. I quote Crawford v Board of Governors of Charing Cross Hospital, 1953:
“The practitioner who treads the well-worn path will usually be safer, as far as concerns legal liability, than the one who adopts a newly discovered method of treatment”.
In the standard Butterworth text on medical negligence, the authors Nathan and Barrowclough expressed in 1957 the following view, still applicable today, concerning deviation from accepted modes of practice and the ethics of new treatment research and experimentation:
“Medical men cannot be permitted to experiment on patients (Slater v Baker and Stapleton) (1767) ... On the other hand the courts will not press this proposition to a point where it stifles initiative and discourages advances in techniques … a line must be drawn between the reckless experimentation with a new and comparatively untried remedy or technique, and the utilization of a new advance which carries with it unforeseen dangers and difficulties”.
I hope that we can agree with Lord Diplock, who was looking for a better balance to be struck between therapeutic innovation and therapeutic conservatism. He warned of the dangers of so-called defensive medicine:
“Those members of the public who seek medical or surgical aid would be badly served by the adoption of any legal principle that would confine the doctor to some long-established, well-tried method of treatment only, although its past record of success might be small, if he wanted to be confident that he would not run the risk of being held liable in negligence simply because he tried some more modern treatment, and by some unavoidable mischance it failed to heal but did some harm to the patient. This would encourage ‘defensive medicine’”—
that is his phrase—
“with a vengeance”.
I am looking carefully at the time and will therefore bring these remarks to a close. Your Lordships will agree that optimal care is evidence-based care. Evidence-based medicine is therefore standard procedure for the protection of patients. However, as your Lordships are well aware, cancer is the least evidence-based disease of all. There is great uncertainty: either the evidence does not exist or, if it does, it is not clear what it means. Innovation is therefore more appropriate in cancer treatment and the consequences of not innovating are greater—poor life quality, followed by death.
I shall end with this. What can your Lordships’ House do—that is the point of this debate—to encourage the drive towards medical innovation, on which my noble friend has made such a great contribution? The advance of science depends upon the free competition of thought and thus upon freedom; that must come to an end if freedom is destroyed. Are the intellectual problems of cancer insoluble? I do not think so. What is more inspiring, apart from a beautiful woman, than the quest by scientists to explain the world; to find satisfactory explanatory theories—simple theories—and to test them? One of them will cure cancer. We should rise to our feet to applaud the great cancer doctors and scientists, many of them in this House, who are striving by their own best lights to serve the community. Let us erect statues in their honour or build bridges in their name, or parks, or avenues, or airports. Let us encourage them, not frighten them.
Lord Winston
My Lords, it is both a responsibility and a privilege to be the first speaker after the deeply moving speech from the noble Lord, Lord Saatchi. He carries the respect of the whole House for tabling this debate and has our thanks for the way that he phrased what he said. I feel that my own contribution will be paltry by comparison, but I thought that it would be interesting to look quickly at my own career and think of seven points in it where innovation was an issue. Our excellent Minister sitting on the Front Bench cannot be expected to be responsible for trying to improve innovation in the health service. This is a colossally difficult issue; I will explain why I think so.
The first thing I want to refer to briefly is my involvement in the early days of microsurgery of the fallopian tube. First, that project, which led to about 50 publications, would not have been possible today because the Medical Research Council grant that I got would not be awarded with the current competition. Secondly, it is fair to say that I would not have got an animal licence to practise a surgical procedure, rather than to do it experimentally. There is a neat difference now in how the regulation is. Throughout, there are at least eight issues that conflict to make innovation difficult. One is regulation; one is infrastructure; one is governance; one is industry and its involvement; one is the internal market, supported by both the Labour Party and the Conservative Party; one is clinical training; another is teamwork. Lastly and most importantly, there is the cultural environment. I will come to one other issue at the end, if I may.
The infrastructure for my work with the fallopian tube would not be possible now because I had access then to a workshop in a district general hospital, where Dennis Melrose was producing extracorporeal circulation pumps to improve heart surgery. That is almost unthinkable now. One of the greatest difficulties I had was in getting industrial support for making the microsurgical needles. I could not find a single industry in this country that would make the needles. We made needles with our own hands, under a microscope, that were so fine and delicate that they did not fall to the ground. Unlike the noble Lord’s papers, they actually floated on the air. Eventually, we found a German company which then captured one-third of the world’s ophthalmic market with those needles. There is a message in that innovation.
With regard to trying to translate that surgery into the female pelvis, the big problem now would be governance. What also followed was the issue of having training in teamwork around, to persuade surgeons to work as a team. That has become more difficult now because of the internal market. It is very difficult to prove that a surgical procedure works and is innovative, because it is more difficult to collect the cases together within a health service structure. We have all faced this difficulty for quite a long time. It is not the responsibility of any one Government.
The same thing applies, to some extent, to laparoscopic surgery. I think I was one of the first people to operate using a laparoscope in this country. There would now be a problem with governance; it would be considered risky and unwise, and would take much longer to innovate.
With the present regulatory system, it would also be impossible to see in vitro fertilisation—your Lordships probably know that I have certainly more than dabbled in that—on the books in the way that it is now. It would be very difficult to transfer an egg that you fertilise outside the body into a human patient. It would certainly take much longer to get permission to do that. That is one of the issues. In my own unit, we made a whole series of improvements. We improved the culture media. We demonstrated, for example, the given knowledge that glucose in the medium was poisonous to human embryos but not to any other animal that was experimented on. We could not change those media now, given the current regulatory framework. Even the little changes that one could make—the fact that tungsten light is dangerous to embryos, for example—become increasingly difficult.
I could go on and on but I do not want to spend more than a few minutes and my time is almost up. It would now take much longer to get permission for things such as embryonic detection of genetic defects. I have to declare an interest as somebody who launched a biotech company. One of the problems with that company, which might change the whole field of transplantation with the use of pigs’ kidneys, hearts and livers, and possibly pigs’ lungs, is that it took us more than a year and a quarter to get an animal licence to practise and do the work on just six pigs. It was quite difficult to get the rodent licence before that as well.
I want to say one final thing. The first experiment I ever did was as a result of fraud in my unit. I was asked to go in and troubleshoot by repeating an experiment. It was pure serendipity that we found that there was probably something wrong, with an infection in the vagina of women that might lead to the possibility of a virus being involved. We now know, of course, that the virus is very well established but I did not know what it was at the time. That was a long time ago but one of the issues with true innovation is that serendipity is extremely important. What we can perhaps best all do together is to see how we might improve the culture in which we do our medicine.
Lord Willis of Knaresborough
My Lords, I begin my remarks by echoing the comments of the noble Lord, Lord Winston. I have been a parliamentarian in both Houses for some 16 years now and I do not think I have ever heard a more moving, considerate or emotive speech than that of my noble friend Lord Saatchi. I thank him for it. In so doing, I have to say that some of the issues that he and the noble Lord, Lord Winston, have raised—and that others will raise—are ones that the Minister, with his responsibilities, can begin to address. Last night, I was responsible for hosting a reception for Children with Cancer UK, an organisation that has been running for 25 years and which began because, 25 years ago, childhood leukaemia killed eight out of 10 children who suffered from it. Now, 80% of children survive it. That happened through innovation—through the very things that the noble Lord, Lord Winston, mentioned and which others will mention—so there is hope. I would want to give my noble friend that element of hope.
My frustration is with many of our scientists’ inclinations. The means to deliver novel or experimental treatments to patients earlier exists. It is not something that does not exist and, quite frankly, it does not require further legislation. With the support of government and an excellent UK life sciences strategy, we have the means to do exactly what my noble friend wants to see. We do not need more legislation; we need action. We need regulators and funders to recognise that, while their approaches are fine for established research pathways and large populations of patients, they are hopelessly inadequate for new and experimental treatments on small, stratified populations.
There is progress. Both the conditional approval scheme and the named patient scheme are important in the toolbox of clinicians who want to try novel and untried treatments but, frankly, they are rarely used. Indeed, perhaps the Minister, when summing up, can say how often they are used and for what purpose. Perhaps, too, he could tell us what progress is being made on the early access scheme, championed in the UK Life Sciences Strategy, which would allow access to drugs earlier than the current regime permits, especially where the compounds under consideration represent possible therapies where few alternatives are available. Currently, the Government’s ambition for this scheme is two to five drugs per year. Does the Minister really feel that that should be the height of this strategy’s ambition?
Perhaps offering more promise, as the Science and Technology Select Committee heard in relation to its regenerative medicine inquiry, is the issue of adaptive licensing, an initiative that also appeared in the UK life sciences strategy. Adaptive licensing offers a flexible approach whereby regulators, clinicians, patients, the research community and industry are jointly involved in assessing the risks of a given experimental treatment so that a proportionate level of regulation can be determined for the release of novel drugs to patient groups. This proportionate approach recognises, as we move to more targeted therapies for smaller populations where traditional clinical trials will be of limited use, that this approach offers an alternative, more appropriate assessment of patient risk and benefits; but, again, where is the urgency or ambition? The expert group that was set up by the MHRA to look at adaptive licences has met only once, in October 2012. Frankly, if that is the rate of progress, it will be years before we see this opportunity realised.
Finally, I come to regulation and regulators, a topic to which I know many noble Lords will return later. When the Academy of Medical Sciences produced its report in 2011, the Government promised simplified, more unified and smarter regulation. The setting up of the Health Research Authority would herald a new dawn for those who see the regulatory burden—particularly for scientists, clinicians and SMEs working at the edge of discovery—as an obstacle to progress. Far from achieving that aim, the HRA appears to have become a very expensive national ethics service. If anything, regulation has become more complex and more bewildering. Indeed, as one expert witness revealed yesterday to our committee, “It is only accessible if you know where to look”.
Clinicians hoping to use new therapies to save the lives of cancer patients do not have the time, and often do not have the resources, to meet the demands of well meaning regulators and their plethora of never-ending hurdles set up to ensure patient safety. That is the real challenge. Without a more agile, unified and flexible regulatory system, which puts patients at its heart, all attempts to move novel and often untried treatments into patients will fail. In that case, we will fail my noble friend in his cause.
Baroness Masham of Ilton
My Lords, I thank the noble Lord, Lord Saatchi, for asking this question so movingly. I feel honoured to be taking part in this debate with such experts. Having a cousin who is research-minded and is a professor, now living in Australia, I want to raise a few points that we have discussed.
Many Britons see their clinical research careers take off after they leave the UK. Some of this is due to the internationalisation of medicine and the growing awareness of how valuable exposure to overseas best practice can be during specialist training. It is a two-way street, so some of the UK’s best specialists come from overseas.
It seems that clinical research comes a poor second after the pressing needs of an overloaded health service have been met. From clinical medical student through resident positions, specialist registrar training and on to first consultant position, it seems difficult to find the time and support for clinical research and development. Apart from a few fortunate centres, where seniors have managed to establish a strong funding stream for R&D, resulting in research fellow appointments, research support staff and so on, there seems to be a poor match between the R&D effort and the acute medical front line. More regional expert centres should be better funded. Steps seem to be needed to recognise where there is already established leadership and to make use of it.
Innovation in healthcare and innovation in clinical research have a symbiotic relationship. Without research there can be no innovation, as there will be no evidence base with which to inform clinical practice. Without that clinically proven innovation being acted on, we will see no advance in clinical practice, no improvement in patient outcomes and less incentive for clinical research to be carried out.
There seems to be frustration from some bodies involved in innovation. For example, Innovation, Health and Wealth promised to:
“launch a national drive to get full implementation of”,
oesophageal Doppler monitoring,
“or similar fluid management monitoring technology, into practice across the NHS”.
This is an admirable policy, but again reality is not living up to intention. Not only is that implementation drive delayed; it has been scaled back. The NHS is also allowing the inclusion of technologies similar to ODM that do not have adequate backing through clinical research and have not been evaluated by NICE. Allowing unproven technology to be on an equal playing field with technology that has been through the rigours of clinical research is both unfair and uncompetitive. It will also result in worse outcomes for patients, lost productivity, fewer savings for the NHS and reduced incentives for clinical research to be carried out in the UK.
Will the noble Earl look again at the ODM implementation plan to ensure that the benefits to both patients and the NHS are realised through proper consideration being given to clinical research? There are so many complicated rare conditions that need new ways of treatment. When medical innovation has come up with the answer, it is vital that patients get the correct treatment for their condition. Nothing is more frustrating for the developers of a treatment and for the patients than when commissioners will not pay, thus holding up treatment and ongoing development.
It is heartening to witness the great support that so many people give to medical research and innovation through charities.
Lord Ribeiro
My Lords, I add my thanks to my noble friend Lord Saatchi for bringing this debate on a matter that is very personal to him. I chair the research panel of the Pelican Cancer Foundation based in Basingstoke. One of our members, Professor Bill Heald, pioneered a new technique for removing rectal cancer in the early 1980s. Total mesorectal excision, or TME, reduces the incidence of a recurrent tumour in the pelvis after surgery. Despite many publications, presentations and lectures on his technique, it was not adopted in the UK. The Scandinavians, however, were more convinced of the benefits, and Professor Heald developed a national training programme with them, which was adopted in the Netherlands, Norway and Sweden in the early 1990s. It became part of routine practice, resulting in improved outcomes for rectal cancer patients. It was to take another 10 years before TME became accepted as a routine procedure and best practice in the UK, despite it having been first pioneered in England.
So how can we speed up the take-up of new procedures? How can we accelerate translational research? In 2007, the national cancer action team and the Department of Health introduced the LAPCO training programme for teaching laparoscopic colorectal surgery. The Royal College of Surgeons promoted and delivered the programme through its new skills centres and, now, through specialist hospitals throughout England. This initiative proved so successful that I was recently asked to give a keynote lecture in the United States to offer our experience of teaching and disseminating laparoscopic colorectal surgery to the surgical community, and our methodology for assessing skills and accrediting competence to practise the procedure. The invitation letter said:
“It is my understanding that the UK has done this in a more proactive and safe fashion than we have in the States”,
an acknowledgment that central direction, as occurred with TME in Scandinavia and now with LAPCO, can produce best practice and innovation.
For a national programme of laparoscopic colorectal surgery for cancer, we will need about 460 surgeons trained in the technique. This is because we have a large NHS caseload, and it is required to meet the NICE guidelines on laparoscopic bowel resection. We currently have half that number. We need to be able to release doctors and surgeons to train innovative procedures. This requires incentives, the support of the base hospital when they have to go away to learn techniques, recognition of their efforts through clinical excellence awards—which I am pleased to say have been reinstated—and other marks of recognition. These efforts definitely show that you can improve the outcome for patients, and the benefit to them is real.
In a report in 2001, From theory to theatre: Overcoming barriers to innovation in surgery, the Royal College of Surgeons recommended that surgical trainees should be encouraged to participate in ongoing research and to work with multidisciplinary teams. With the support of CMO Dame Sally Davies, who was mentioned earlier, the Royal College of Surgeons has committed to funding five surgical trial centres from 2013, with the aim of recruiting thousands of patients for these trials. As surgeons, we are often criticised for not getting involved in randomised control trials; the comic opera referred to as “surgeons trying to do research” perhaps refers to this.
It is necessary today for us to carry out these trials because the number of trials carried out in surgical discipline comprises less than 10% of those done in cardiology. The trials units will provide expertise to develop multi-centre surgical trials, offer technical support and speed up the delivery of clinical trials. As surgeons, we are trying.
In order to speed up the process, from theory to theatre, it is vital that we involve patients in decisions about innovative treatment. Patients must understand the potential risks so that they are able to give full, informed consent. The process for doing this is in place—we have study design, ethical approval and patient involvement—but it needs to be expedited. We all know how long it takes to get approval to start a new trial. It is important that we do not have to wait the length of time that Professor Heald in Basingstoke did to introduce a procedure which has clearly saved many patients’ lives.
Lord Rennard
My Lords, I first declare my interest through the work that I do with the British Healthcare Trades Association, as in the register. However, the issue that I was asked to raise in this debate is specifically about the provision of insulin pumps.
I am one of the 2.9 million people in this country already diagnosed with diabetes. As a type 2 diabetic, I was first told that my treatment would only be in the form of tablets, but in common with many people who are diagnosed at a relatively early age with what they used to call “mature onset diabetes”, I found that after 10 years or so I also needed insulin injections every day. Now, as our understanding of dealing with diabetes grows, I am advised by my excellent diabetes specialist nurse that I may well need an insulin pump in another 10 years or so in order to be able to maintain good control of my condition.
The prevalence of diabetes is growing, and the period of time over which people need treatment is growing substantially. I am, therefore, concerned that many people with diabetes, who might benefit considerably from the provision of insulin pumps, do not currently find them available on the NHS. A survey not very long ago showed that the average rate of insulin pump provision for people with type 1 diabetes in this country was 3.7%, compared with the then 12% benchmark recommended by NICE and in comparison with other countries, such as the USA, where such provision is estimated at 35%, and Sweden, France and Germany, where it is estimated at 15-20%.
Good diabetes management is, of course, crucial to reducing diabetes-related complications, such as hypoglycaemic episodes and potentially fatal conditions such as heart disease and strokes. Greater use of technologies such as insulin pump therapy can deliver much better outcomes for patients. It can also help to reduce cost savings for the NHS by improving diabetes control, reducing primary care contacts, and reducing hospital admissions and hospital outpatient contacts.
However, the provision of insulin pumps is very patchy and inconsistent. Many healthcare professionals are not trained in supporting patients on insulin pump therapy and, as a consequence, are reluctant to recommend it as a treatment option. The position seems much better in Scotland. The Scottish Government announced in February 2012 that they would invest over £1 million to deliver insulin pumps to patients with diabetes. Over the next three years, their NHS boards will increase the number of insulin pumps available to under-18s, in addition to tripling the number of pumps available across Scotland.
Patients must of course be given accurate information about self-managing their condition, which should include advice on insulin pumps as a treatment option. It is imperative that healthcare professionals are trained in supporting patients to use insulin pump therapy.
Baroness Morgan of Drefelin
My Lords, I congratulate the noble Lord, Lord Saatchi, on securing this debate. I, too, found his introduction moving, so I thank him for that.
I declare an interest as chief executive of the medical research charity Breast Cancer Campaign and, perhaps more importantly for this debate, honorary president of Cancer52, an alliance of more than 60 organisations—many of which are very small and unstaffed—working to address the issues faced by those with less common cancers who make up 52% of UK cancer deaths, including ovarian cancer.
The promotion of a vibrant research environment is absolutely essential for the development, evaluation and take-up of new medical innovations in our NHS. Research and innovation are vital if we are to ensure better outcomes for cancer patients, which is why I am so proud that we in this House worked hard and successfully to ensure that duties to promote research and innovation were included in the Health and Social Care Act 2012. It is now equally essential to make sure that these duties are embraced by the new NHS structures as they take up their responsibilities in the coming months. I know that there is much debate about how that will happen.
I turn to an issue that is of concern to many patients: the use of drugs which are off-patent and not licensed for a particular indication, but which could be helpful in new and innovative ways. This is a little related to concerns that the noble Lord, Lord Saatchi, has raised through his Private Member’s Bill. Many noble Lords will have seen the news yesterday about proposals from the National Institute for Health and Clinical Excellence to recommend the use of the drugs tamoxifen and raloxifene for the prevention of breast cancer in high-risk patients. The barrier to using tamoxifen for chemoprevention in the UK arises from the fact that the drug is now off-patent and its original licence does not cover the use of tamoxifen for chemopreventive purposes, despite the drug being licensed for this indication in the United States for a number of years. Because existing UK legislation only allows the original owner of the drug to seek to change the indication—even when a drug is off-patent and there is therefore no incentive for the drug company to seek a change at this stage—this means that medical professionals who may wish to prescribe the drug for their patients must do so outside the existing licensing agreement. This is a significant disincentive and we could argue that it is stifling innovation.
Indeed, the draft guidelines issued by NICE yesterday are clear. They state that the prescriber of these drugs should follow the General Medical Council’s good practice in prescribing medicines and take full responsibility for their decision. This means that medical professionals must clearly document that the patient, or whoever has the authority to give consent on the patient’s behalf, has provided informed consent to receive the drugs for chemopreventive purposes.
Although the NICE guidelines are designed to circumvent this problem and make health professionals more comfortable with prescribing these particular drugs for chemoprevention, the best way to eliminate any remaining doubts for prescribers would be for a new avenue to obtain licences for new indications for drugs where there is a clear evidence base of clinical benefit and when they are off-patent. Therefore, would the Minister tell us what avenues the Government are exploring for closing this existing shortfall in the current legislation? Have the Government perhaps explored any possibilities for public bodies such as NICE to seek new licences for off-patent drugs where the manufacturer has no incentive to do so? He might want to write to me on this, but it would be very interesting to hear how this kind of innovation—which is looking at existing medicines and discovering how they might be used in different ways in different conditions —could be made a more nimble, innovative process.
Baroness Finlay of Llandaff
My Lords, I, too, congratulate the noble Lord, Lord Saatchi, for having described, in a very moving and clear speech, the reality and the horror for patients of illness and treatment, and the difficulty that many patients and their families face while in the shock of realising that life is not as they hoped it would be and has changed in an instant.
The noble Lord, Lord Saatchi, has highlighted the push and pull of the dilemma of innovation in medicine. We have a push from research councils to innovate; we have a push in academic medicine, principally in secondary care in specialist services, to innovate, to think and to instigate new trials; and we have a push from industry to come up with developments. However, we have a pull, which is a risk-averse system that is frightened of taking the decision to go with something that looks as if it might be high-risk or to go with the unknown. It is that tension between the push and pull that I think we are caught in the middle of today. Perhaps this debate is really timely, because we need to think about how we should handle that.
I was involved in some of the early trials to which the noble Lord, Lord Willis, referred, of children with leukaemia. I remember some of the children who were in the arms of the failing drugs; I remember them as if it were yesterday. I can see in my mind’s eye the room and the face of the child who then died and having to talk to those parents. However, it was through those trials, through every child taking part, that the face of childhood leukaemia has completely changed. I sincerely say, thank God that it has, because there was a terrible toll before those trials were properly instigated.
Another problem for patients, when they are faced with a disease for which there does not seem to be a conventional treatment on offer, is that in desperation they go off and try to find their own treatment and therapy. It is worth remembering that about half, or possibly more than half, of patients with malignant disease of any type seek help and treatments outside of conventional medicine, going for complementary or alternative medicine—often taking treatments for which there is no evaluation. Some years ago, it was a great difficulty for my team to cope with people who were coming in and saying that they were taking shark’s fin. The ecological disaster, the cruelty to sharks and the total lack of evidence of any efficacy made us come up with a form of words that we could use to dissuade patients from ever even thinking along those lines and discuss with them their use of alternative therapies or medicines. Some things that they pinned great hope on really had no benefit.
I also congratulate the noble Lord, Lord Saatchi, on having focused our minds on the patient in the context of themselves as a person and their whole family. He put me in mind of a patient I had at one time who was in exactly that situation. She was a young woman with a rare disease who was clearly dying. We discovered that her children had been fundraising at the school gate for a treatment that they had found on the internet. This treatment had been shipped over from America and she wanted it given to her. There was no evidence base that I could find for it, and I discussed it at length with her and her family, documenting everything—pages and pages of documentation of those conversations. She knew she was dying but she wanted to try it because she knew that her family could live afterwards if she tried it; but if she had not done so, they would not have been able to. Therefore, I undertook to take the whole responsibility on myself for administering it, equipped myself with drugs for every adverse event that might occur, and gave her one dose. There was no adverse effect but there was no benefit either, but after her death her children, who had fund-raised at the school gate, were able to cope better and were glad that she had at least tried it.
We have a system in medicine called the N of 1 trial, which is underused and should be used, particularly where we have rare conditions and genetic disorders, and where we could document and should be documenting what we do. There is a problem, though, for those who instigate such trials in getting them published. I would like to address the publication difficulty in my closing remarks—the difficulty of pooling all the little bits of information that can come from different aspects of medicine.
I think that the N of 1 trial will have an increasing place as we get further into rare genetic conditions and personalised medicine, but the NHS, with its push to embrace research as a core component, is going to have to look at a kind of buffer zone for funding the additional bits of work that need to go along with doing that properly. We also need to have good publication of negative results and we need to publish all the results, including all the adverse effects, when trials fail. Unless all of those emerge, we really will not know the full picture and what we are dealing with.
I make a plea that in this push-pull with which we are faced in medical innovation, there is a real push to have a repository for the results of some of these N of 1-type studies, and a repository for negative results and those that are currently going unpublished.
Lord Ryder of Wensum
My Lords, I congratulate my noble friend on the clarity and strength of his speech. I am conscious of the medical distinction of many noble Lords here tonight; I participate as a layman.
For the past eight years I have chaired the Institute of Cancer Research, an organisation driven by innovation. The institute, a college of the University of London, employs about 800 scientists from more than 40 countries. According to the Times Higher, we came top of the most recent research assessment exercise. We prize a global-leading drug discovery unit and are proud that over the past six years alone, 16 of our drugs have been nominated as candidates for development. Two months ago, an innovation debate took place at the Royal Society. Professor Paul Workman, head of cancer therapeutics at the institute and the RSC’s entrepreneur of the year, was a speaker. He argued that, although we are making strides against cancer, we are failing to convert our knowledge into outcomes. To be precise, our knowledge of the genomes of cancer cells should be allowing us to develop targeted therapies for patients—what is known as personalised medicine.
There are many reasons why we are not advancing at greater speed. Biotech companies are diminishing because venture capitalists demand profits in three years, when in our sphere it is often a struggle to achieve results within a decade. Pharmaceutical companies should be switching from blockbuster drugs to personalised medicines targeted on small patient groups based on cancer genes, but we suffer from the fact that these pharmaceutical companies are also enduring an era of change, which is typified by the theme of next month’s Pharma Summit in London—namely, “Should pharma cut its losses and get out of R&D?”.
How can we turn our knowledge into targeted drugs? How can we bridge this innovation chasm? The commendable Strategy for UK Life Sciences, which was produced by the Government, urged us to develop infrastructures that connect academics, industry, investors, clinicians and the NHS. Thanks partly to a long-standing relationship with our sister organisation, the Royal Marsden Hospital, that is our model. It has worked well for years in terms of innovation and outcomes. It is vital for it to be taken up in as many places and as many fields as possible.
We also require more investment in drug discovery and development carried out by non-profit groups, especially early-stage drug projects that are too risky for industry and can be advanced quickly only in the lab and with patients. In addition, we require further re-evaluation of regulations and pricing. Patients must have earlier access to drugs. I am told by institute clinicians working in the Royal Marsden that the European clinical trials directive handicaps their work and impedes innovation. The Minister will know that, unfortunately, clinical trials carried out in the UK, as a percentage of the world total, have fallen from 6% to 1.4% during the past 10 years.
Drug discovery and development is the UK’s leading innovation-based business. It is the UK’s most successful manufacturing industry in terms of the surplus it provides for the balance of payments. However, expenditure does not necessarily correlate with inventiveness. I have always upheld the Schumpeter line that innovation is the critical part of economic change, yet Governments have a duty to create the right climate for innovators, and they have plenty yet to do.
Baroness Warwick of Undercliffe
My Lords, when I read just before Christmas the cri de coeur of the noble Lord, Lord Saatchi, about the lack of progress in finding cutting-edge treatments for cancer, I had huge sympathy, which has been reinforced by his passionate speech today. I remember a similar sense of anger, frustration and bewilderment at the lack of speedy diagnosis and then effective treatment of my mother’s cancer, albeit some years ago now.
I hoped that the science would move on. I knew how good our scientists and our clinical researchers were, so there was no question in my mind that our scientists could produce results so long as they were given the means and the encouragement to do so. Sadly, the improvements have been patchy and, in some cases, stubbornly resistant. A few months ago, I noted in a debate on pancreatic cancer that there had been virtually no change in treatments over the past 20 years, although it is about not just drugs but early diagnosis and access to surgery.
There are many reasons why progress has been less speedy than we might have hoped. The noble Lord, Lord Saatchi, has identified one important area—the effect of medical negligence claims and the risk-averse culture that they generate—and I wish him good speed with his Private Member’s Bill.
Another area often cited as a brake on innovation is regulation. I declare an interest as chair of the Human Tissue Authority. I want to offer some thoughts on how regulation might be a force for good and need not stifle innovation. It is vital that all bodies involved in the health service do all that they can to facilitate high quality medical innovation. Innovation in medicine leads to improved healthcare and quality of life, and can have significant economic benefits.
Sir David Nicholson’s recent report, Innovation, Health and Wealth, provides us with a clear picture of what needs to change if we are to encourage further innovation in medicine and healthcare. In his report, Sir David makes a passing reference to regulation as a “top-down pressure” on innovation but, importantly, he does not identify regulation as one of his six,
“barriers to innovation in the NHS”.
No one doubts that regulation has value in providing assurance for quality, safety and efficacy, and regulation can sometimes be a driver of innovation. None the less, and notwithstanding the exclusion of regulation from Sir David’s six barriers, it is clear that some regulation, if it is excessive, complex, unclear or inflexible, can impede innovation. I believe that we should review all healthcare regulation in terms of design, implementation and enforcement, to ensure that unnecessary barriers are removed. The regulators should be challenged and, just as importantly, should challenge themselves to ensure that they are not creating barriers to innovation.
I shall finish with a few words about the approach to regulation used by the Human Tissue Authority. Of particular relevance to this debate is our remit relating to the use of human tissue for patient treatment and the development of regenerative medicines, where we work very closely with the Medicines and Healthcare products Regulatory Agency. The HTA is very supportive of research and ensures that effective regulation supports good practice and high-quality science which, in turn, leads to improved healthcare.
There is no doubt that some of the regulation in this area is complex, primarily because the science itself is complex, as is the legislation underpinning that regulation. Complex does not have to mean burdensome, however. At the HTA we believe that a key role of a regulator is to provide clarity and to support organisations in working through the quality and safety regulations. I urge the Minister to reinforce the point that, if done well, regulation can yield significant benefits. It provides assurances about quality and that products can be used safely for patient treatment. It promotes faith in the efficacy of products. Will the Minister confirm that regulators should be committed to doing all that they can to support innovation in medicine? This is certainly true at the HTA, and I hope that the Minister will encourage all regulators in the sector to have such an enabling approach.
In my last few seconds, I should like to raise a related topic. I learnt this morning of a proposal in the European Parliament that the minimum duration of a medical training programme should be increased to six years. This could have serious consequences for graduate-entry programmes in the UK. Medical schools will probably not be able to recruit arts graduates, and surely we need creative people in the profession if we want to be more innovative, especially when evidence shows that they make as good doctors as do science graduates. Will the Minister take this back to his colleagues and ask them to do all that they can to prevent the requirement being increased in this way before the vote on 24 January?
Lord Patel
My Lords, I thank the noble Lord, Lord Saatchi, for initiating this debate and for presenting it so movingly. This ought to be the start of such debates. It ought not to be the last debate we have on this subject. I hope he will remain committed to leading us in future debates.
Some of the treatments the noble Lord described, particularly for some cancers, are medieval and this continues to be the situation for some cancers. Treatment for pancreatic cancer, to which the noble Baroness referred and of which both my mother and my mother-in-law died, remains the same. However, there is hope. Some novel and innovative treatments are now being tried out, such as molecular tagging of drugs to get at cancers that are not amenable to conventional treatment. There is also nanomedicine for targeting tumours that are not responsive to current treatments. There are other technologies that I will come to which could be used to target tumours that are not receptive to radiotherapy.
We should also be slightly more optimistic in this country about where our science is today compared with 10 years ago. For instance, we have had 12 Nobel Prize winners in medicine and physiology since 2001. We have to go back to 1998 for the previous one. Not only that, we have Nobel Prize winners in allied disciplines, such as Sir Venkatraman Ramakrishnan who won the chemistry prize in 2009 for his isolation of the structure of life science-related diseases.
We now have a commitment from the Government to investing in science and having strategies in life sciences and other fields. We should give credit for that. We hope that innovations will come but we must also ensure that regulation is proportionate and is not bureaucratic. We must always keep an eye on that.
There is also the question of investment in translational medicine. One example is in the field not of drug therapy but in cell therapy where big pharma will not invest and small countries do not have the money to do early translational research. There are many examples. One is the use of embryonic stem cells as a therapy for age-related macular degeneration. Currently, the first-phase translation of that is being funded through research councils and charities. The Government should be funding early-phase translation. What plans do the Government have to help with this?
I come now to technological advances and I use the example of focused radiotherapy which is often referred to as “cyberknife”. Of course it is not a knife: it is focused radiotherapy. You cannot use conventional radiotherapy for targeting tumours because you will do more harm to normal cells. Currently, to make that available to a patient who is not amenable to conventional treatment, the doctor will have to ask for finances from commissioners or PCTs. They do not have the expertise to know whether that is indicated for that patient or not, and they may or may not fund it. The Government should be commended for accepting in the Health and Social Care Act that all NHS organisations must have an awareness of research, but it is difficult to find money to fund an expensive, one-off treatment. However, that is sometimes the only thing that is available to the patient. We should support such technologies and make sure that whenever we find that they are not supported, we do something about supporting them. Will the Minister confirm that he will expect commissioners to look at such treatments and innovations in a more favourable way and provide the funding that individual patients require? These treatments are expensive.
I again thank the noble Lord, Lord Saatchi, for initiating this debate. We should debate some of these issues at length at the Second Reading of his Bill and I wish him luck with that.
Lord Kakkar
My Lords, I, too, thank the noble Lord, Lord Saatchi, for having introduced this important debate with so much courage and with such intellectual power. In doing so, I declare my interests as Professor of Surgery at University College London, as Chair for Clinical Quality in our academic health sciences centre, UCL Partners, and as an active clinical researcher.
Innovation is absolutely at the heart of improving clinical practice and outcomes for our patients. It is only right that patients, their relatives and the public expect the profession and government to do all they can to ensure, first, that the research necessary to develop innovative treatments and diagnostic strategies is promoted at national and local levels, and that, once we become aware of innovation—be it through research in our own country or anywhere else in the world—it is quickly identified, adopted and placed in clinical practice. Her Majesty’s Government have placed a particular emphasis on this. Driving a research commitment in the Health and Social Care Bill for the first time, ensuring an obligation on the Secretary of State for Health to promote research and development in the NHS, was an important statutory development. We have the commitment of funding through the National Institute for Health Research, the biomedical research centres and their associated units, and the academic health science centres, which all promote early-phase, experimental and clinical research in our healthcare system.
However, Her Majesty’s Government have also recognised the problem of adopting the findings of that innovation and diffusing it more broadly across the healthcare system and across larger proportions and populations of patients. The recent report, Innovation, Health and Wealth, has identified the need for the development of academic health science networks with a clear obligation to ensure that high-impact innovation is quickly adopted and diffused across populations and healthcare systems, and that the recognised therapies that have been shown to have important clinical benefit and are approved by NICE through its guidance mechanisms are applied more broadly across populations for which we are responsible.
We have also heard in this debate that there are important hurdles to innovation in our healthcare system. These hurdles are regulatory, they are potentially legal and they are cultural in terms of the way that clinical practitioners and others work in the National Health Service and healthcare systems more broadly.
With regard to regulation, I should like to ask the Minister about one particular problem that we have heard about today—the European clinical trials directive. I know that Her Majesty’s Government are involved in negotiations at the European level to overcome some of the problems associated with this directive, which has been damaging to clinical research in our country. Is the noble Earl able to give an update on the progress that has been made there and on what changes might be made to this regulation in the future?
With regard to the legal problem, the noble Lord, Lord Saatchi, identified case law which suggests that there may be anxiety in clinicians’ minds about innovating when it comes to the individual patient in front of them. This may indeed be a very important problem and something that needs to be addressed. As we have heard in this debate, it needs to be addressed in a sensitive and careful way to ensure appropriate innovation and to ensure that clinicians who are in a position to innovate do so effectively but that any deleterious effect is not allowed to take place.
Then there is the question of culture. This is particularly important because much of the debate today has focused on what the views of clinicians and researchers, the healthcare system and indeed the Government may be on innovation. However, we must also look at innovation from the patients’ point of view, as well as that of their relatives. They are right to expect that when they need it most, innovation, wherever it is, is responsibly applied to the management of their case. In all the important work to drive innovation, and the research and development of biomedicine that has been achieved in our country so far, we must be sensitive to the fact that we may not be meeting the expectations of patients—our fellow human beings—when they are at their most vulnerable, and therefore more may need to be done to drive an improved culture for the adoption of innovation and the improvement of practice in our country.
Lord Turnberg
My Lords, it is clear that we are all enormously grateful to the noble Lord, Lord Saatchi, for introducing this very timely debate. It was impossible not to be moved by his remarkable personal story, and I respect and admire the motivation that lies behind his desire to see the best possible treatments being made rapidly available for patients. He has certainly stimulated a wide-ranging debate.
I declare an interest as a trustee of the charity Ovarian Cancer Action and as a one-time practising clinician. We have heard from a number of noble Lords about the time-consuming, bureaucratic regulatory pathway that new drugs have to go through, and we should do something about that—I hope that the noble Earl might comment. However, I want to concentrate on how it might be possible to bypass this normal route to approval, and to give patients a drug that has just come out of research. I shall limit myself to cancer patients.
We know that the Government are committed to embedding research in the NHS, although we are a little way off delivering fully on that holy grail across the whole of the NHS as yet. However, it is the case that novel candidate drugs for cancers are being developed all the time, and are being used for patients in many major centres around the country. At the Cancer Research laboratories that we heard about, the Christie hospital in Manchester, the Beatson Institute in Glasgow and centres in most other cities new drugs are being developed all the time. The £200 million cancer fund has been invaluable in making them available for patients. What will happen to this funding when the source dries up, as I believe it might? It is a tragic fact that, despite some remarkable advances, there remain many cancers that have proved terribly resistant. Ovarian and pancreatic cancer, for example, creep up on patients with vague symptoms or none at all, so that diagnosis is often made too late.
The point is, however, that as novel treatments become available, they can be and are being tried. Of course, there are strict conditions. Novel treatments can be given to individual patients only during clinical trials or on a named patient basis, where patients are made fully aware of the risks and dangers as well as the fact that the treatment may or may not help them. They must give their informed consent. Then, the best conditions for giving the treatment must be available. Those involved in the research, who understand the possibility of adverse side effects, should be available, as should the laboratory facilities to monitor the patient’s response. These are the conditions under which it is reasonable to give novel treatments, and they are just the ones that are provided by the NHS in our major cancer centres around the country.
It should be clear, too, from all of this that it is difficult to provide these conditions outside major centres, particularly in private hospitals where the expertise may not be available. Consultants there are often on their own, and do not have the full back-up that would give them confidence. They may feel vulnerable and unwilling to take the risks to which they would be exposed. Furthermore, private funders may be quite unwilling to fund untried treatments or the extra tests needed to monitor the patients.
I come to the problem described by the noble Lord, Lord Saatchi. It is clear that we do not currently lack the ability to try out novel treatments within the NHS, and I have described the best conditions under which they should be and are being given. However, there are problems of continuing funding, with particular difficulty in private hospitals and in some district general hospitals which lack the facilities. In those hospitals, doctors and their patients need to be made aware of the limitations that exist. When the possibility of a novel treatment arises, patients should be offered the prospect of transfer to a centre where the relevant research is going on and the treatment is being given.
This debate has been invaluable in setting out a set of problems that really deserve our attention. The need to be able to speed through the availability of novel therapies is vitally important, and we must do something about the regulatory burden. However, so far as the use of innovative treatments is concerned, I am not yet convinced that we need a new law to achieve what we want. We should concentrate on spreading information about what novel treatments are emerging across the whole of the service, what treatments are available in our cancer centres, and ensuring the rapid transfer of patients to those centres.
I very much look forward to the noble Earl’s response and I hope that he will say something about many of the other problems mentioned today, such as streamlining regulation, availability of cancer funds and replacement of those funds by some other source. I believe that we owe an enormous debt of gratitude to the noble Lord, Lord Saatchi, for raising the debate, and for giving me my moment in the sun on the Front Bench.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, my noble friend Lord Saatchi introduced this debate most compellingly and very movingly, and I thank him for bringing a subject of such importance to us and one on which your Lordships have considerable expertise, as this debate has amply shown.
Let me start, as many speakers have done, by focusing on the NHS. The unique and integrated nature of the health service has brought many advantages. Since the NHS was established in 1948, innovation has brought incalculable benefits for patients. Treatments have been improved, as has health policy. Inequalities have been reduced. Productivity has been increased. However, while the NHS is recognised as a world leader at invention, the spread of those inventions within the NHS has often been too slow, and sometimes even the best of them fail to achieve widespread use. It still takes an estimated average of 17 years for only 14% of new scientific discoveries to enter day-to-day clinical practice. This is not acceptable. Patients have the right to expect better health, better care and better value from their NHS.
We need to make sure that our staff can get the best, transformative, most innovative ideas, products and clinical practice spread at pace and at scale so that every patient benefits. That cannot happen without innovative minds working with the best resources in a creative and supportive environment. As the noble Lord, Lord Winston, reminded us so powerfully, research is an essential part of the innovation pathway. The Government’s investment in basic health research through the Medical Research Council underpins invention, and our investment in applied health research through the NIHR underpins evaluation. Translation of research is also vital for innovation to progress along the pathway. I hope that the noble Lord, Lord Patel, will be pleased to know that the Government are investing a record £800 million over five years in a series of NIHR biomedical research centres and units. These are translating scientific breakthroughs into better treatments for patients.
Demands on healthcare continue to rise for now and the foreseeable future. We must meet those demands from within our current real-terms funding, while at the same time improve quality. Accelerated change is not so much a goal as an absolute necessity. This means that doing more of what we have always done is no longer an option. We need to radically transform the way in which we deliver services. Innovation is the only way in which we can meet these demands. Spreading innovations in large disaggregated organisations is notoriously difficult. It is one of the biggest challenges facing the NHS. Systematic bottlenecks come with the territory. To make things harder still, technology adoption can be very complex, often requiring significant and disruptive reorganisation. New methods can require different expertise and mean new training, while care pathways have to be overhauled and existing procedures decommissioned. There can be financial barriers or issues of silo-budgeting. Of course, if we are to change this there have to be effective and efficient ways for innovations to reach the patients who need them. This must be across the NHS. That is why implementing the recommendations in Sir David Nicholson’s report, Innovation, Health and Wealth, is crucial. It set out a delivery agenda for spreading innovation at pace and scale throughout the NHS. Its programme is designed as an integrated set of measures that will together support the NHS in achieving a systematic and profound change in the way in which services are delivered.
The innovation landscape before the publication of IHW lacked transparency and accountability; there was variable compliance with NICE technology appraisals, and the picture was confused and cluttered with layers of organisations seeking to serve as gateways for interaction between the NHS, academia and industry partners. Value for money for patients, the NHS, UK plc and healthcare partners was, I have to say, doubtful and innovation was not a central priority throughout the system. IHW seeks to overcome barriers to innovation that have built up over decades, and aims to deliver long-term, sustainable change embedded right at the heart of the NHS. To do that, we need not only to change structures and process but, as the noble Lord, Lord Kakkar, reminded us, to change culture and behaviour—and this takes time.
Innovation is a top priority for the new NHS. This was most recently illustrated by the publication of its planning guidance on 18 December which clearly stated:
“All NHS organisations should demonstrate how they are driving innovation and developing delivery mechanisms for long-term success and sustainability of innovation in their health economy”.
To spread ideas right across the NHS means working collaboratively with all those who have an interest. I am completely in agreement with my noble friend Lord Ribeiro on this. This is why we want to see a more systematic delivery mechanism so that innovation spreads quickly and successfully through the NHS. This can happen in a number of ways, in particular through Academic Health Science Networks, or AHSNs. The NHS needs a stronger relationship with the scientific and academic communities and industry to develop solutions to healthcare problems and get existing solutions spread at pace and scale. AHSNs present a unique opportunity to align clinical research, informatics, innovation, training and education and healthcare delivery—exactly the issues highlighted by the noble Lord, Lord Winston. They will improve patient and population outcomes by translating research into practice, developing and implementing integrated healthcare services. My noble friend Lord Saatchi will be glad to know that our ambition is for every NHS hospital to be part of an AHSN.
The noble Baroness, Lady Masham, expressed her view that clinical research was somewhat of a poor relation in comparison to delivery of services. We have done a great deal to turn that situation around. Through its integrated academic training programme, the NIHR has taken a lead in reversing the decline in clinical academic careers. Around 250 NIHR academic clinical fellowships and 100 NIHR clinical lectureships are now available annually for medics. Last month we announced the award of five new NIHR research professorships in the second competition for these awards, and a third round is under way.
The noble Lord, Lord Winston, my noble friend Lord Willis and the noble Baroness, Lady Warwick, focused on regulation and the varying degree to which it can be a force for good. I listened with concern to what my noble friend Lord Willis had to say about the Health Research Authority. He is so up to date that I probably do not need to tell him this, but the House may be interested to hear that the HRA is collaborating with other regulatory and advisory bodies, for example the MHRA, to create a unified approval process for the approval of health research and to promote consistent and proportionate standards for compliance and inspection. This should reduce the impact of regulation on research-active businesses, universities and NHS trusts; it will improve the timeliness of decisions about research projects and hence improve the cost-effectiveness of their delivery; and it has the clear support of the Academy of Medical Sciences’ review of health regulation and governance.
My noble friend Lord Ryder rightly focused on earlier access to drugs. That is one of the reasons why we have introduced the cancer drugs fund, as the noble Lord, Lord Turnberg, was kind enough to mention, of £600 million over three years. Clinicians can now proscribe the cancer drugs that they feel their patients will benefit from, and 23,000 patients have already benefited from it. I will write to him on the future of the fund.
My noble friend Lord Willis referred to adaptive licensing. This is a subject in which I have taken a personal interest. It is an important area but, I would say, one in which there are many complexities. He is quite right that the MHRA has convened an expert advisory group to consider matters such as this, and I attended its meeting last October. However, we need pharmaceutical companies to come forward and nominate candidates for adaptive licensing. So far, despite asking, no such candidates have been proposed, but we are pressing forward in that area as fast as we can.
My noble friend Lord Ryder also referred to genomic and personalised medicine, an area of major importance in the delivery of personalised medicine, as he said. My right honourable friend the Prime Minister announced on 10 December that the ambition of the UK is to achieve a paradigm shift in the development of high throughput genome sequencing. Our ambition is to sequence 100,000 patients and have a small number of contracts in place to deliver this from 2014. From a standing start, I think that is going to be an impressive achievement, and we are on track to deliver it.
My noble friend Lord Saatchi took us very movingly to the subject of cancer, and a number of other noble Lords have also spoken about it. I fully recognise that, with cancer, screening and the identification of symptoms are vital, and perhaps the single most important thing that will improve outcomes. I will write to my noble friend about this, because all is not lost in this area. We have cause for hope, contrary to what he said, not least in ovarian cancer, where there has been a slow but steady improvement in one and five-year survival rates over the past few years.
My noble friend Lord Ribeiro rightly focused on the slowness of adoption of techniques developed in the UK. I agree that that is the problem. It is one that we are trying to address, but it is a matter of culture, which, as I have said, takes time to change. In addressing long-term culture change, we are seeking to make innovation at pace and scale everybody’s business in the NHS. People throughout the service have to feel ownership of the agenda. The IHW programme is bringing together a community of leaders at different levels in the system who will work together over the next few months to build commitment and ownership in the NHS, to ensure that innovation really is at the heart of the way the NHS does business.
As so often, time is my enemy. I have a number of other things that I would like to have said if I had had more time, not least to my noble friend Lord Rennard, the noble Baronesses, Lady Masham, Lady Finlay and Lady Morgan, and, indeed, others. If they will allow, I will write to them all and to other noble Lords whose questions I have not answered.
I believe we can point to a great deal of progress being made at a time of great change in the NHS, but much more needs to be done to deliver the improvements we need. We must not be complacent, and I am not. We owe it to patients, the public and our stakeholders to achieve that systematic adoption and diffusion of innovation that I have referred to. We are committed to a future in which innovation is a core function of the NHS. That will help us achieve our overall aim, which is to have health outcomes as good as any in the world.