Grand Committee
The Deputy Chairman of Committees (Lord Bates)
My Lords, if there is a Division in the House, the Committee will adjourn for 10 minutes.
National Curriculum
(11 years, 8 months ago)
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The Parliamentary Under-Secretary of State for Schools (Lord Nash)
My Lords, thank you for the opportunity to debate the Government’s proposals for the reform of the national curriculum in England. As noble Lords know, on 7 February, my right honourable friend the Secretary of State for Education announced a number of proposals to improve the content and design of the national curriculum. These proposals are the product of a painstaking and thorough review which the Department for Education has undertaken over the past two years—a review that was launched with the expressed aims of restoring rigour and high standards, ensuring that all children are taught essential knowledge, skills and understanding in the key subject disciplines, and granting teachers greater freedom to design lessons that meet the needs of all pupils.
The proposals on which we are now consulting are the culmination of extensive analysis of curricula used in the world’s most successful education jurisdictions, particularly in the core subjects of English, mathematics and science, and consideration of nearly 6,000 submissions to our call for evidence. We have also engaged with teachers and head teachers from across the country to learn more about the most effective practice in England, and have worked with subject experts and key organisations across all national curriculum subjects to inform our thinking.
The launch of the consultation on our proposals last month was preceded by a number of other publications of interest. In December 2011, the review’s expert panel, chaired by the respected curriculum and assessment expert Tim Oates, published its report. This set out a series of recommendations for the new national curriculum framework. It formed part of a wider suite of documents setting out the results of the call for evidence and research conducted by the review. This included a summary of evidence gathered about curricula for English, maths and science in high-performing jurisdictions and a research report on subject breadth in the curricula used in other education jurisdictions. The findings uncovered consistent themes that have challenged some of the tenets of our current system, showing, for example, that high-performing jurisdictions set higher expectations in terms of what they believe children can and should master at different ages.
In June 2012, we published draft programmes of study for primary English, maths and science for wider discussion. Since then, we have discussed the drafts with key subject organisations, teachers and subject experts, and have reviewed the content in the light of the feedback we received. These discussions have informed the draft national curriculum that was published last month.
The new curriculum upon which we are now consulting is both challenging and ambitious. It benchmarks our expectations in the core subjects of English, mathematics and science against those displayed by the highest performing education jurisdictions.
It is right to place this debate in an international context and to learn from those who are performing best. These jurisdictions, such as Hong Kong, Massachusetts and Singapore, which are shown by international surveys of pupils’ performance to consistently outperform England despite the best efforts of our many excellent teachers, deliberately set out to compare themselves against others, learning from other nations and asking constantly what is required to help all children do better.
Let me set out the scale of the challenge and how we are falling behind. Our performance in maths in the TIMSS study of pupil performance at the age of 10 has not improved since 2007, or at the age of 14. TIMSS science results show a drop in performance—at age 10, our mean score dropped markedly from 542 in 2007 to 529 in 2011, and at age 14 from 542 to 533. Our results in the PISA survey show that we are behind high-performing jurisdictions in reading, with an above average spread of attainment between pupils who do well and those who do not.
In the most recent PIRLS 2011 study, England ranked 11th out of 45 countries in the reading performance of pupils in the equivalent of year 5. Five countries performed significantly better than England: Hong Kong, the Russian Federation, Singapore, Finland and Northern Ireland. In the most recent PISA 2009 study, England ranked 25th out of 65 countries in the reading performance of pupils aged 15, falling from seventh in 2000; 28th out of 65 countries in the mathematics performance of pupils aged 15, falling from eighth in 2000; and 16th out of 65 countries in the science performance of pupils aged 15, falling from fourth in 2000.
Every performance measure reinforces the scale of the challenge that we face. In 2011, 18% of pupils in England left primary school without meeting the current expected standard in English, and 20% in mathematics. Employers and universities have also repeatedly highlighted school leavers’ lack of proficiency in these subjects. In mathematics specifically, England is among the countries with the lowest levels of participation for 16 to 18 year-olds, with fewer than 20% of young people studying mathematics to the age of 18. In most high-performing jurisdictions, the study of maths in this age group is almost universal. The Government have already set out their ambition for the vast majority of young people to study mathematics to the age of 18. It is therefore vital that we act now to create a new national curriculum that gives every child, regardless of their background, a broad and balanced education so that, by the time their compulsory education is complete, they are well equipped for further study, future employment and adult life.
Beyond ensuring that children are taught the essential knowledge in the key subject disciplines, we want to give teachers greater freedom to use their professionalism and expertise to help all children realise their potential. As part of this, it is important that schools and the wider public understand the difference between the statutory national curriculum and the whole school curriculum. All schools must provide a curriculum that is broadly based and balanced, of which the national curriculum is just one part. The school curriculum could be described as the way that schools bring the national curriculum to life and meet the needs of all their pupils. To do so, teachers must have freedom: freedom from top-down prescription and freedom to innovate. That is why there will be no statutory document to accompany this new curriculum telling teachers how to teach the subject content that it defines.
This is a huge cultural shift, but also a massive opportunity for teachers. In providing greater flexibility for professionals, we have considered changes to both curriculum breadth and depth. International evidence shows that high-performing jurisdictions tend to promote a wide range of subjects in compulsory education. We will therefore retain the current subject composition of the national curriculum, with the addition of foreign languages at key stage 2. Subject to the outcome of this consultation, we will change the name of the subject currently known as ICT to “computing” to better reflect its new content. We do not believe that further prescription of subjects to be taught at key stage 4 is necessary or appropriate; we are using other measures such as the English baccalaureate to encourage more schools to offer a broad academic education to all pupils—particularly the most disadvantaged—to the age of 16, in line with our international competitors.
I am sure that noble Lords will be interested in some of the detail of the new curriculum. As I have already mentioned, programmes of study in all subjects—except primary English, mathematics and science—have been significantly slimmed down, removing unnecessary prescription about how to teach and setting out the essential knowledge and skills which every child should master. In primary English, maths and science, we have taken a conscious decision to provide a higher degree of exemplification in order to ensure that we achieve the step change in standards that is essential.
In English, there is greater emphasis on reading for pleasure, and greater clarity on spelling, punctuation and grammar. In mathematics, the new curriculum will place a stronger emphasis on arithmetic and will include more demanding content on fractions, decimals and percentages. In the sciences, the programmes of study we have published include greater detail on key scientific concepts and processes. The mathematical aspects of science have been strengthened, and for the first time primary schools will be expected to teach their pupils about evolution and inheritance.
For the first time, and in line with practice in other countries and evidence about children’s cognitive development, there will be an expectation that foreign languages will be taught in primary schools. As well as enhancing the status of languages in the school curriculum, this will provide a better foundation for the teaching of languages in secondary schools, where there will be new content on translation, grammar and vocabulary at key stage 3.
In citizenship, our proposals make financial education statutory for the first time, and similarly propose that practical cooking is compulsory at key stage 3 in design and technology. In music we have balanced performance and appreciation, and in art and design there is a stronger emphasis on drawing skills and on the historical development of art. In history, rather than a disconnected set of themes and topics, we have set out a clear chronological narrative of British and world history. In geography there is a greater emphasis on locational knowledge so that pupils can use maps and locate key geographical features such as oceans, cities and continents.
In PE, there is greater emphasis on competitive sport to build character and self-esteem and to improve teamwork. As well as being valuable in and of itself, this will help ensure that we build on the wonderful legacy of the London Olympics. Finally, as I mentioned, we propose to replace the old ICT curriculum with a new computing curriculum with a focus on the principles of computer science and practical programming skills to ensure that England retains a competitive edge in the growing digital economy that will be key to our nation’s future economic prosperity.
The new curriculum will provide parents everywhere with a clear guide to what their children should know and be able to do in every subject as they make their way through school. It will also provide those schools that are choosing to take advantage of the freedoms and opportunities afforded by academy and free-school status with a reference point for designing their own school curriculum. The consultation exercise on our proposals will run until 16 April and we are keen to hear from everyone with an interest before the new national curriculum is finalised and published later this year. The timing of the debate is therefore pertinent, and I welcome further discussion of these proposals. I beg to move.
Baroness Whitaker
My Lords, after that very helpful broad sweep I will focus only on design, because its importance has not been sufficiently realised. I congratulate the Secretary of State on his decision to broaden the measures for judging a school beyond English, maths and science to the pupil’s eight best subjects. This enlightened and far-seeing decision leaves room for design to become a subject of choice and for the fostering of centres of excellence, which will be much to our national advantage.
However, the curriculum that is proposed needs some rethinking. Many others think so, not least the 100 professors who wrote to the Daily Telegraph last Wednesday. They pointed out that the skills of problem-solving, critical understanding and creativity are losing out in the battle to raise standards. A proper design curriculum would go far to fill that gap. I should say at the outset that no one wants to lower standards, and that the Secretary of State’s attempt to entrench rigour is well understood. However, the whole of the design community, from practitioners to academics, is united behind wanting a more relevant—in fact, a more rigorous—syllabus. The Design Council has spoken of a “lost design generation” if this element of the curriculum is not brought up to a modern standard.
For a start, there are two syllabi that feature design: art and design, and design and technology. This is confusing. The idea of design in both syllabi falls far short of what design means now. In the art and design syllabus it seems to mean only the use of material and techniques for executing works of craft and art. The design and technology syllabus, too, concentrates on materials and includes cookery, mechanics, maintenance and horticulture. There is nothing about digital technology, one of our most promising design developments, and there is a perfunctory nod to our great national tradition of invention and design. It says that pupils should,
“investigate the rich history of design and technical innovation”.
I wonder what the pioneers and icons of that tradition, Sir Humphry Davy, Watt, Stephenson—or Sir Jonathan Ive—would have thought of their great expertise being exemplified by classes in maintenance and a balanced diet.
Why does this matter? Excellence in design is—at the moment—one of our great national strengths. We export more than £45 billion-worth of design-related goods and services to the EU alone and about £18 billion- worth to Asia and beyond, providing more than 900,000 jobs. Design-related goods and services make for about 4.5% of total UK exports. We have a truly world-class capability in design and it is highly export-facing. None of that will last if we impoverish the design curriculum in schools. It would also betray our historic prowess in innovation to forget, and allow our children to forget, that it was our great tradition of industrial and architectural design which created the economic basis for our place among developed nations and, I would argue, quite a lot of the social and cultural basis too.
How should design be taught? Good model syllabi have been presented to the Secretary of State by the Design Council and professional design organisations. To summarise: design is a problem-solving, multidisciplinary and collaborative process, which places the user’s needs at its centre. Of course it uses materials and techniques, but that is subordinate to developing the capacity to make an idea for solving a problem into a reality. It is a sound intellectual basis for many other capabilities and it fits its pupils to become active citizens and agents of change. Its relation to art is not the technical mastery that artists require to realise their vision, but rather it is the bridge between arts, science and technology, which enables the making of innovatory products and services. The hundred professors might have been talking about design when they concluded their letter by saying:
“Schools in high-achieving Finland and Massachusetts emphasise cognitive development, critical understanding and creativity”.
I urge the Minister to ensure that their message is listened to.
Lord Storey
My Lords, I thank the Minister for giving us the opportunity to discuss this important matter. I want to speak as a primary teacher on the primary school curriculum. The clue is in the title: “draft”. It is a draft, and this is the opportunity for us to give our own views. All of us, probably, have been bombarded by different organisations claiming all sorts of concerns. We only have to look back to the 1980s when the only subject that was legally required to be taught at primary level was religious education. Then there was the scandal of the William Tyndale school, and of course Mr Baker—now the noble Lord, Lord Baker—with his national curriculum of core and foundation subjects. It is to his credit that a lot of that is still in place and that many of the subject parts are there.
However, the most important thing of course about a curriculum is that it has to give teachers the opportunity to teach. You can have the best national curriculum in the world but unless you have high-quality inspiring teachers, nothing else really matters. Perhaps we will come to history in a moment, but that reminds me of a quote from Alan Bennett, the author of “The History Boys”:
“Teachers need to feel they are trusted. They must be allowed some leeway to use their imagination; otherwise teaching loses all sense of wonder and excitement”.
I welcome a slimmed-down national curriculum and also the opportunity for education to be broad and balanced. We do not want a curriculum, as currently, of 150 pages but do want the opportunity for teachers to flourish. A slimmed-down national curriculum gives teachers more freedom to adapt their lessons to children in their class and local circumstances.
I said at the beginning that no doubt there will be lots of people and organisations giving their own opinion. Perhaps surprisingly, I want to congratulate the people who put together this draft; they have done a first-rate job. There are things in this that I am very satisfied with. With regard to the core subjects, I like the focus on content and stretching, particularly for achieving pupils. I do not subscribe to this nonsense about, “Why are we insisting that children at age 11 should know their multiplication tables up to 12?”. It is part of mathematics to know your tables. I do not subscribe to this nonsense that perhaps there is too much reliance on spelling and punctuation. My goodness, English is about spelling and punctuation. It is about oracy and being able to recite a poem. It is about reading for pleasure.
Then we look at languages. I have sat on a Select Committee looking at how SMEs can be encouraged to export more, and one of the key parts of that report said that we should be teaching languages in our schools. The best way to teach languages is with young children. There was a pilot in my home town of Liverpool where we started teaching languages to four and five year-olds, and the results were spectacular. Once this curriculum has bedded in, perhaps we could visit that at some later stage. My other concern is that perhaps we are being a bit restrictive on the languages that we are teaching. We need to look at other languages, particularly those of the developing world.
I like the notion of PSHE being there. I am concerned that citizenship should be part of key stage 2 as well. I am delighted that swimming is an integral part of PE, and about music and dance. Using the local environment in science may answer the concerns of the Woodland Trust.
I am concerned about sex education. Why do we have this view that we should not teach sex education to key stage 2 pupils? I do not know. I teach it to key stage 1 pupils. It needs to be natural. Some of the girls at primary school will be starting their periods, and they need to know about sex education. It should not be left until key stage 3.
There has been a lot of fuss about climate change. Actually, I think that climate change is clearly there as part of the mandatory science curriculum, but if there are concerns then let us address them. Then there is history, but I have one minute left to speak so I will come back to that on another occasion.
Teaching cannot be prescriptive. Different teachers use different methods to develop children. If this is a national curriculum, why is it not national? Why are 60% of our schools not going to be using it? I am talking about academies and free schools. If we have a national curriculum, surely it should be national.
My party has argued for years for a shorter, more focused curriculum. We are ambitious for all our children. That is why I believe that our children should have the chance to work on content that is as stretching as those in the best-performing countries. It is our teachers who know the most effective way to teach an individual child in their class. The curriculum respects the professionalism of teachers on the front line by giving them more freedom to do what is best for the pupils in their class.
Lord Northbourne
My Lords, I am most grateful to the Minister for making it possible for us to have this debate on the curriculum, which it is not going to be possible to debate in the Chamber because it will not involve any new lawmaking.
Personally, I have no argument with the Government’s policy of basic skills such as reading and writing being improved, nor with maths, science, English and foreign languages being emphasised and standards being raised. However, I am concerned about what the Government have left out. There is a real danger, given that schools’ resources are finite, that if they are told to do subjects A, B and C but no mention is made in the curriculum of D, E, F and G, they are going to concentrate their resources on A, B and C. Of course they are; that is how they will get rewards and a good Ofsted report, and it is what the Government will give them more money for.
I am going to raise only one issue, which is of particular importance to me, but first I should like to make this point. The Government’s position paper speaks eloquently about the importance of clear aims in education policy and the curriculum, but it fails to spell out clearly what those aims are. They refer to the wider definition set out in the 2002 Act of spiritual, moral and cultural development, but even that does not include social values, which I shall talk about in a moment. I can find nothing in the Government’s proposals to suggest that they recognise the importance of the so-called soft skills. Surely the overriding aim of education must be to prepare young people for the challenges, opportunities and responsibilities of adult life. Soft skills play a key role in adult life. They are important for employment and are crucial in establishing and sustaining a family and raising children. Further, they can make a considerable contribution to increasing social mobility in our society. I will not detail what the soft skills are because I might take too long, but I expect that most noble Lords are fully aware of the skills of empathy, emotional literacy and so on.
Recent neurological research shows that a child’s experiences in the first two years of life are a critical factor in that child’s success in school and later in adult life. It is during the first two years that a child learns the crucial emotional skills. It learns that it is safe and valued, and it begins to learn to love and be loved. That is why secure attachments in the very early years to one or two dedicated carers, which Bowlby told us about 50 years ago when no one believed him but have now been proved by biological science, is fundamentally important to a child’s development. The Government have responded to this research by introducing the early years initiatives, excellently presented by Graham Allen MP. I strongly support the programme, but standing alone, in my view, it is not enough. We must do more to prepare all the nation’s young people for adult life by helping them to acquire while at secondary school the soft skills they will need for employment and to form stable families.
Sadly, PSHE has been relegated to a very low priority in most secondary schools. In those schools where it is covered at all, it is often taught by teachers with no specialist training in the subject. To achieve this kind of education effectively, a new and broader PSHE programme should be developed and then delivered by specialist teachers with experience. They should be trained to lead young people in an exploration of and preparation for adult life.
I want to suggest three modest things that the Minister might do to help this along. The first would be to make mention in the current revised curriculum of the importance of developing soft skills. Reference should be made to the importance of these skills outside the narrow curriculum, but certainly in the wider one, or how will schools know what their priorities should be? They have a limited amount of money and a limited number of teachers. The second would be to bring together an expert advisory group to prepare a report on the best ways to give secondary school pupils the opportunity to prepare for adult life, while the third would be to sponsor a pilot project at a major teacher training institution to undertake an experimental course training specialist teachers to deliver such a course interactively, led by young people’s own needs and interests.
Lord Black of Brentwood
My Lords, I congratulate my noble friend on the admirable way in his excellent opening speech in which he summed up the issues facing us. This debate offers us all the opportunities that a bran tub presents to a small child—so many possibilities. Part of me wanted to talk, like the noble Lord, Lord Storey, about history. Part of me wanted to talk about music, but I hope that the noble Earl, Lord Clancarty, may do so later. I want to talk about animal welfare and its place in the national curriculum, in particular relating to domestic animals and pets. It is proper for me to declare a feline interest as an owner of a venerable Russian Blue cat, Victoria, who is 17 next month. I had her and her welfare very much in mind while I have been putting together these remarks.
Despite the wonderful work of many animal welfare charities—I think in particular of Cats Protection, which is the UK’s leading feline welfare charity and has helped more than 1 million cats in the past five years—there is still an endemic problem within our society relating to animal welfare. In 2011, the last year for which a full set of statistics was available, more than 126,000 dogs were allowed to stray by their owners, which represents an increase of 30% in three years. In the same year, Cats Protection rehomed and reunited 48,000 cats and kittens. Blue Cross experienced an increase of 57% in the number of unwanted rabbits that they were asked to rehome. Most worryingly, PDSA research shows that of the estimated 22 million pets in the UK, more than 10 million may not be having their welfare needs met.
The reasons behind such shocking and alarming figures are no doubt complex. In some ways they reflect the state of the economy, among other things. However, it is inevitable that education, or indeed lack of it, about animal welfare is one of those reasons. Problems of neglect, cruelty and abandonment often happen because people do not understand what a pet needs and how to care for it. One of the best ways, over time, to tackle this issue is therefore to ensure that children are taught properly about how to care for pets. Children, after all, are the pet owners of the future. Yet, currently only 16% of children are taught about caring for a domestic animal, despite the fact that more than 60% of children will be from homes keeping a pet. This is not a marginal issue but one that clearly relates to the majority of children.
Our animal welfare charities, which so often are unsung heroes, do what they can to train young people in animal welfare issues. Battersea Dogs and Cats Home, Blue Cross, Cats Protection, Dogs Trust and PDSA delivered education talks to more than 175,000 children in 2011. There is a big appetite in schools for information and training in this area. A survey for the Pet Food Manufacturers Association in 2012 found that 78% of primary school teachers and 70% of secondary school teachers agreed that it was important to teach younger children responsibility through learning to care for pets. The RSPCA ran courses for nearly 4,000 teachers in 2011.
However, there will always be a limit to what voluntary bodies with tight resources, limited manpower and uneven geographical spread can achieve—and here the national curriculum is therefore vital. It is very good that the draft curriculum makes reference to the basic needs of animals within the year 2 primary science curriculum, but this relates only to survival and the need for water, food and air. However, an animal’s needs are not limited to those. There are, in fact, as the Animal Welfare Act 2006 sets out, five basic welfare needs—environment, diet, behaviour, companionship, and prevention of pain, suffering and disease—which contribute to a healthy and happy life for our pets. All need to be learnt.
A new subject does not need to be added to the curriculum to deal with this issue, nor does it cross the vital line that my noble friend mentioned of becoming involved in how a teacher teaches. All that is necessary is for the current reference to basic needs to be amended slightly to allow teachers the flexibility and scope to teach about all five welfare needs, linking them to scientific knowledge and concepts within their lessons. In short, the concept of development needs to be placed alongside survival in the year 2 curriculum. Such a tiny change could bring benefit of real significance, not just to many defenceless animals in the future but to the way in which children grow and develop. Teaching children from an early age about the importance of caring for pets will help them to integrate effectively with others and understand the importance of responsibility, something that has profound benefits for society as a whole.
It is, as they say, a win-win scenario that I urge my noble friend to accept, and one which will not make any greater burden on teachers or require surgery to the draft curriculum. I hope that my noble friend the Minister will undertake to look further at this matter.
Baroness Coussins
My Lords, I will focus on modern foreign languages and declare an interest as chair of the all-party group on modern languages. The reasons why learning a language is important are clearly not controversial, judging by the Education Secretary’s recent comments. It improves oracy and literacy in English and has all-round cognitive benefits. As Mr Gove put it:
“It is literally the case that learning languages makes you smarter. The neural networks in the brain strengthen as a result of language learning”.
Learning other languages enriches cultural knowledge and understanding; benefits the UK economy and enhances employability.
There will, however, be unintended consequences of the new language curriculum for the system of adequate secondary school accountability unless certain issues are resolved upfront. The Government are quite right to commit to statutory languages at key stage 2. The Language Trends survey, published only last week, shows that 97% of primary schools are doing this already, but this figure masks some critical problems and disparities which could make the policy backfire. Nearly a quarter of primary schools have no staff with foreign language competence beyond GCSE and some are even worse off. Will the Minister tell us what investment the Government will make in the support, training, guidance and recruitment of suitable teachers so that all 18,000 primary schools are properly equipped by September 2014?
The transition to secondary also requires attention. Teachers in year 7 commonly start all over again with languages, because children arrive with such different levels of achievement. This demoralises and demotivates them. Will the Government encourage schools to use either the languages ladder or the Common European Framework of Reference for Languages to help?
The Government propose a list of seven languages to choose from, but I fear that this may exacerbate the transition problem. Perhaps key stage 2 should be confined to French, except where an LEA-wide agreement exists between all primary and secondary schools to teach another language. This is the case in Hackney with Spanish and guarantees continuity and progression. In general, however, French is the only language for which there is a realistic hope of finding enough teachers and for which progression to secondary school could be planned and achieved.
This should not stop additional languages being offered at key stage 3—and not just Spanish and German. Other languages identified by the recent British Academy report as important for British international and commercial interests include Cantonese, Arabic and Turkish. Will the Minister look at reinstating the Asset Languages qualifications, withdrawn by the OCR? It is short-sighted to praise the language skills of children who speak what we call community languages, but to deny them the opportunity to turn their casual or domestic level of competence into something more academic and professionally useful.
A rather shocking piece of information was reported to the all-party group the other week by the head teacher of one of the specialist language-teaching schools. She told us that she had met primary heads who were saying openly that they planned to apply for their schools to become academies to avoid the national curriculum requirement to teach foreign languages. I would like to hear the Minister confirm that this is not only undesirable, but wholly unacceptable, and tell us what the Government will do to prevent any school becoming an academy in order to avoid offering modern languages.
Moving on to key stages 3 and 4, the Language Trends survey shows very positive teacher feedback in favour of terminal exams as proposed by the Government. However, the Government should think again about their new secondary school accountability system based on the first eight GCSEs. This would allow schools to get their points whether the pupils take languages or not. The LTS shows that the boost to take-up from the EBacc last year has been sustained, which is good, but it has not increased, despite the Government’s forecast that the EBacc would transform languages’ take-up. Will the Minister accept that, unless languages are compulsory at key stage 4, take-up will never get back to its 2004 level?
Languages are meant to be compulsory at key stage 3, but the survey revealed that one in five state schools disapplies lower-ability pupils. On top of that, a quarter of state schools have shrunk key stage 3 to two years, leaving us with large numbers of children with hardly any language learning at all. What will the Government do to reinforce compulsory languages at key stage 3? They should be spearheading a national languages recovery programme to create a coherent, statutory languages pathway from key stage 2 right through to the end of compulsory education, just as there is for maths. There are some welcome aspects of the proposed new languages curriculum, but it is not yet well enough thought through to provide or sustain the step change we need.
Baroness Walmsley
My Lords, I, too, welcome several aspects of the proposals of the new national curriculum. I welcome the idea of languages from age seven. There is evidence that if a child learns a second language early, he will find it easier to learn other languages later and it is generally advantageous to his cognitive development. Is seven too young? No. Many children in my neck of the woods learn Welsh and English at the same time from day one, and my grandchildren learnt English and Chinese from day one. However, how about including language experience courses in primary schools, rather than just forcing schools to choose from a restricted list of languages? That would avoid many of the problems outlined by the noble Baroness, Lady Coussins.
I welcome personal finance in citizenship lessons. At least citizenship is currently statutory, and I hope it will remain so. Also, welcome back to cooking. Cooking is cross-curricular, of course; you can get a great geography lesson out of a good curry.
I welcome computer science to replace IT and its place in the EBacc. Ian Livingstone, the co-founder of the Games Workshop, said recently:
“You know something is wrong when you have a million young people unemployed, and 100,000 jobs vacant in IT”.
Employment in the IT industry is expected to grow at nearly five times the UK average over the next decade, but there is a major and growing skills gap that, unless addressed, will damage the UK economy. So it is great that we are switching to proper computer science.
However, unless at the same time we also address the lack of careers advice about opportunities in the industry, young people will still not choose the subject. Where will the teachers come from? The main problem is a lack of enough teachers with the right knowledge and experience. Here there is good news. Last week I went to a presentation, hosted by the noble Lord, Lord Empey, at which a presentation was made by major players in the industry, and it became clear to me that there is enormous enthusiasm and desire to help schools and universities produce appropriately qualified young IT specialists. The Government must harness this enthusiasm. Indeed, there is no other way of staffing schools and universities to do the job, so there must be a true partnership between the Department for Education, BIS and the industry.
The rest of the science curriculum must also be relevant to the major global issues of our time. Why cut out debate about climate change from geography and put a mere mention of it into chemistry? This aspect of the proposals was criticised by Sir David King, the former Government Chief Scientific Adviser. That is not all, though; food security is mentioned only in passing. Why not include issues about the catastrophic effects of the loss of biodiversity? This serious global problem, usually caused by habitat destruction, is responsible for poverty; the loss of food security, water security and many valuable medicinal plants; the loss of sustainable livelihoods for some of the world’s poorest people; the reduction in the ability of the natural world to adapt to the inevitable climate change; and much else. In other words, it is an absolute disaster, the scale of which we have yet to see but will come to regret, and there is no mention of it in the science curriculum. Neither is there any mention of engineering, which we are told will solve the energy crisis. I hope that creative science teachers will use their newfound freedoms to introduce these enormously important subjects into their teaching. The science curriculum is one that I would have recognised when I was at school more than five decades ago.
I also regret the absence of PSHE. How can a school offer a broad and balanced curriculum and prepare a child for the challenges and opportunities of life without the elements of PSHE? However, at least science is statutory, so it is important that science includes the most important elements of PSHE, including relationship and sex education—and note that it should be that way around. The science curriculum should teach pupils about growing up and cover sex with honesty and confidence. It should adopt clear, open language and a positive tone relating to human reproduction and health, and should include young people from the gay and lesbian community without embarrassment.
Of course parents should be engaged with this part of the curriculum and it should be age-appropriate, but it should certainly be timely. Children should know about puberty before it happens to them—that is, at key stage 2. At key stage 3, the current content on sexual health and disease, contraception and adolescence should be retained and information about hormones and abortion should be added. However, it is difficult to include in science those parts of a good PSHE curriculum that foster self-respect, confidence and the respect for others that cuts down bullying in schools and makes children their own best protectors. Now is not the time to squander the opportunity of ensuring that all children are given the sort of education that will enable them to protect themselves.
Baroness Kidron
I am grateful to the noble Lord, Lord Black, for mentioning his cat, since I am going to mention my children. I declare an interest as a co-founder of Film Club, a charity that has a presence in more than 7,000 state schools.
Tim Oates’s review lays out the four pillars of an education as practised across all the high-performance jurisdictions. I found it helpful because one of my children goes to an independent day school and this, broadly speaking, is the education that he is given. In his school the spectre of the EBacc qualification neither reared its head nor receded, as it was declared stillborn, nor did it suffer the decline in music and art teachers as the status of the arts was diminished. The announcement of the history curriculum, decried by academics and at least one of the Government’s own advisers, is not a conversation that will touch these young men. When the dust settles, they will still get multiple A*s on a broad curriculum that sees England as more than an island and develops their intellectual curiosity in a wider world. These children do not have to make choices between arts and science or drama and languages. They have sex education and a broad range of extracurricular activities. Perhaps most importantly, their school’s reputation is judged not on part but on the whole.
By contrast, a year ago I found a young child emerging from a GCSE consultation in tears, not understanding why she was being “forced”—her word, not mine—to take history. There were more tears from a teen in Southampton, unable to get on a vocational course at the age of 16 because it was being reconfigured to start at 17. She was unable to return to school because she did not have the correct GCSEs but was unable to get a job or claim benefits because she should be in education.
What of the eloquent teenager in a council chamber in the north-west, making a case for her student council that was being disbanded, only to hear the councillor say with great regret that he had no jurisdiction over the school because it was now an academy? As the importance of oral learning is finally established across the curriculum and the CBI makes a case for the importance of transferable skills, student councils, a perfect rehearsal for public life, can be dropped in our “flagship” schools with no accountability.
Perhaps worst of all, for me, were the woeful faces of those who missed a grade boundary last summer, their plans in tatters as the goalposts were moved in the middle of the game. These children, unprotected by privilege, are the victims of an ideological tussle played out in our schools by Ministers insisting on targets that distort the allocation of resources and exacerbate the gap between those with access to cultural and financial capital and those without.
The Government have indeed solicited advice from the best educational jurisdictions, which unanimously recommended a broad curriculum, yet we are faced with a proposed system in which some subjects are more equal than others. If we are to help young people to contribute to the life of the nation, why has citizenship been demoted and why are ethics, religion and philosophy not in the academic core, as in the French bacc? If personal development is a cornerstone of good learning, why has there been obfuscation of the language that describes issues of puberty and genitalia in science, while PSHE has been left out of the discussion altogether to fight an uphill battle on an entirely separate battlefield?
The national curriculum review asserts that curricular aims are,
“essentially ethical, moral and political statements, making transparent the values and ambitions to which a nation aspires”.
This process has not been coherent. There is implicit unfairness in setting the rules according to the status of the institution rather than the needs of the child. As the noble Lord, Lord Storey, said, if it is a national curriculum, why not have it in all our schools? In my view, what has been described—I do not have time to go into it in detail—is detailed but simply not ambitious enough, broad enough or deep enough for children who lack privilege in other parts of their lives.
Lord Lucas
My Lords, I am a great fan of the national curriculum review. It is set out with the right principles underlying it of increasing emphasis on knowledge and on ambition and is well executed. The current consultation is a real consultation. I have had several conversations with departmental officials and found them more than willing to listen. I am hoping that today we shall have an example of a Minister who is more than willing to listen. We shall see. Therefore, I encourage my noble friend Lord Storey to write in and say what he wants to say about sex education. I suspect that some members of the ministerial team live quite sheltered lives down in Sussex and Norfolk. I can tell them—as I am sure the noble Lord, Lord Nash, can—that life in central London is a bit different and that the worst bits of the internet are well into primary schools in year 5, and we want our children to be helped to resist them and overcome them. Leaving things until secondary school is not good enough. However, as I say, I encourage my noble friend and others to write in and say that.
I very much hope that my right honourable friend will resist those of the 100 who want him to change the history curriculum. I am delighted that we have got history away from the academics who think that history is about studying history, and to understand that it is about people—us—our roots and why we are and who we are. I encourage him to get through the whole of British history in the primary curriculum. Simon Jenkins compresses it into 250 very readable pages, which I hope my daughter will get through in six months, or perhaps rather less, at a rate of a chapter a day. History is not a burden to be considered but an essential part of being British. I am delighted to see it back.
The noble Baroness, Lady Whitaker, focused on the design and technology curriculum. It has, indeed, been filleted. All that is left is horticulture, cooking and DIY. Therefore, I very much hope that my noble friend the Minister will say to his colleague Michael Gove, “Look at what has been done here. This is the most marvellous opportunity. Here we have a subject which has imploded on itself, where, in most schools in the country, the teaching is disconnected from anything else. There is far too much low-quality teaching in craft and design and where we have swept it out of the curriculum let us put something in its place. Why don’t you, Michael, do what you have done so triumphantly in computing and challenge the engineering, design and materials industry to come up with something worth while in this space because technology has now made this possible? You can get, at no great price, decent computers. You can get very good programmes to put on them. You can get lovely machines to stick on the end of both of that—things like 3D printers and computer-controlled routers and laser cutters. You can create quite sophisticated things. Put an end to these useless wooden bookshelves that fall apart on the second day of use and start to create in this space something which should be the foundation for pupils to enjoy engineering and take a real delight in what they can do and create, and a foundation for people who will go on enthusiastically to careers in engineering, design and other such areas”. If we do this, we will find that what emerges in the design and technology space supports what we want to see being done in the main subjects. Mathematics can be brought back at an advanced level. You can take the sort of approach that Conrad Wolfram wants and bring really sophisticated mathematical analysis into how to make something of a particular shape. There is an awful lot of physics in studying how to build something and then control it properly.
Opportunities will arise to deal with the presently separate art and design curriculums because they will be using computers. Schools are being given the opportunity to create real interfaces with business because when they are equipped with this kit, which as I say is not a great price, they will have something that every small and medium-sized enterprise involved in manufacturing will envy and want to come and use out of hours. They will want to co-operate with the school, which means that the school will have access to people in industry. The kit is up to date and what people in industry as well as schools want, and there will be real opportunities for creating the kind of collaboration that we would like to see. Beyond everything else, it would make sense of the opportunities being provided by the new computing curriculum. I hope very much that this is a cause which my noble friend will espouse.
Lord Sutherland of Houndwood
My Lords, in view of the points I am about to make, I have to declare two interests. I shall be speaking briefly about Ofsted, so I should declare that I was formerly a Chief Inspector of Schools. I also declare an interest in computing and computer science, so I warmly support the points that have been made, not least about the presence of IT in design. I am the non-executive chairman of a company called Frog Trade which operates in Halifax and employs 90 software engineers, many of whom are recruited locally. The absence of appropriate training in schools will be a difficulty. Frog Trade supplies more than 20% of English secondary state schools with their IT and software, and will be supplying every mainland Malaysian school with IT and software products. That is a sign of the importance of having this discipline embedded in young people’s development. It is there anyway, so we might as well support it in the curriculum.
Let me offer some statistics. I repeat without apology two that were given to us by the noble Lord in introducing the debate. In 2011, some 18% of pupils in England left primary school without meeting the current expected standards in English, while 20% did not meet the expected standard in maths. I shall add two further statistics to those. Some 30% of 16 year-olds do not achieve the expected standards of literacy, and the real shocker is that over half of those who are serving sentences in Her Majesty’s prisons are functionally illiterate and innumerate. We are failing many young people in our society, and that alone is justification enough for looking once again at the priorities that must deliver an education to deal with these problems.
Perhaps I can give some bold and rational advice. Following on from Micawber, if there are 36 teaching hours in a week and we provide material for 37 actual hours of teaching, the result will be frustration and bad education. If there are 36 teaching hours and we provide 35 hours of content, perhaps professionalism and balance in education will be part of our legacy. It means that we have to be careful not to say that everything should go into the curriculum. One of the great heresies is this: if something must be learnt, it must be in the school curriculum. That is a mistake. My grandchildren pick up huge amounts of learning from what are sometimes rather dubious forms of education. Indeed, if I were pushing my special area, I would be arguing that Socratic dialogue should be compulsory for all students at key stages 2, 3 and 4, but I think I might lose.
The national curriculum is one of the three great pillars of our education system. One pillar deals with content, which is the curriculum, one deals with standards in the form of national testing, and the last deals with accountability, which is national inspection. All three play an important part. The danger in this consultation—this is where I differ from the force of the papers that we received—is that we select this one topic, the national curriculum, without looking at the impact on the other two areas, which are significant.
I remind noble Lords of some of the other heresies to demonstrate what I mean. Heresy one is that it is too readily assumed that only the examined in education are likely to be taken seriously or to be of any value at all. We assume that examination is the criterion of importance. This is the head teachers’ heresy. Head teachers who bow to this principle in what they do should be condemned. Heresy two closely follows this—the twin educational sins of teaching to the test and focusing on those students who might be coaxed from grade D to grade C. This is the bad teachers’ heresy. The third heresy, which has been mentioned, is that the national curriculum is to be equated with the school curriculum. This is the lobby groups’ heresy. It is not true that one overlaps completely with the others. The principle behind what we are talking about is that there should be a core—for the statistical reasons that I have given, if no others—but there should be a balanced education.
Accountability takes place significantly through examinations, but it is limited accountability. Ofsted is the other source of accountability and I suggest to the Minister that he takes back to his colleagues the idea that Ofsted be tasked with looking at those areas of the curriculum that are perhaps not in the core but encourage soft skills that deal with PSHE, and with making explicit judgments on schools and their success in providing whole-pupil education in a balanced form. Perhaps that is the stick that is needed, and Ofsted could provide it. I hope that that idea can be taken forward, and I am pleased that there is consultation on accountability as well as on the curriculum.
Lord Empey
My Lords, I warmly welcome the objective at paragraph 1.1 of the consultation to,
“ensure that all children are taught the essential knowledge in the key subject disciplines”,
and the proposal to replace the current ICT curriculum with a new computing curriculum with more emphasis on practical programming skills. I also welcome the recognition that we have a moral obligation to the youth of today to ensure that they have the essential skills and tools to function in an increasingly digital world.
There is a massive IT skills shortage across all industries, due to the decline in numbers of computer science graduates. The UK Council of Professors and Heads of Computing estimates that there is a 15% rise in demand for IT professionals, while the number of students aiming for jobs in the industry has fallen by 50% since 2001. The number of people studying any form of computer science in the UK has fallen by between 24% and 28% since 2002.
In London, IT provides 48,000 digital economy jobs, more than double the number of such jobs 15 years ago at the time of the dotcom boom. This progress is under severe threat by a skills shortage, namely an undersupply of skilled developers and technicians within the UK, and technology firms blame ill designed university syllabuses and a lack of understanding at all levels of the education system. The number of young people studying IT has fallen correspondingly with the standard of ICT teaching from school to university over the past 15 years. Graduates have therefore become ill equipped to enter a competitive jobs market meaningfully, and overseas students are often better qualified. We must therefore recognise that curriculum reform is required in higher education, not just in schools.
Computer science is the fourth science on our educational curriculum, although there does not appear to be any provision to educate primary school teachers in the discipline. As the introduction of this document says:
“No education system can be better than the quality of its teachers”.
There is also a shortage of teachers in computer science in secondary schools, with no incentive for top graduates to enter the profession.
Something else that must be mentioned is the gender imbalance among students of computer science at a higher level. In 2012 the ratio of female to male students was 1:100. Fewer than 300 female students in the whole of the UK take computing A-level each year. Only 18% of graduates from IT-related courses are female. This represents a huge loss of opportunity and potential skilled personnel, which will ultimately leave us less competitive in the long term.
Last week, as the noble Baroness, Lady Walmsley, said, I had the pleasure of hosting an event in this House on computer science education in the 21st century. I met several extremely bright and enthusiastic young female teachers who, it was obvious to me, cared deeply about their subject and their pupils. This makes the loss of opportunity even greater.
Perhaps it would be best if the department facilitated greater engagement and communication between the ICT industry and higher education, to design courses that prepared graduates for industry and made them a great asset to the industry as a whole. Graduates do not and will not always have the perfect skill sets to fit the job. However, employers must be more amenable to offering periods of training to bring new graduates up to speed in areas where they need to recruit, and realise that it does no good complaining about a lack of a competent workforce if they are not prepared to help to fix the problem themselves.
Industry could also become more involved in lower-level ICT teaching, for example in primary and secondary schools. It is important that the Government engage these businesses and use their guidance in shaping the ICT education of our children. It is not just the state’s job to rise to this challenge; it is also incumbent on big corporations and employers. Having reaped the benefits of our educational system and careers in ICT, they have a moral obligation to continue this legacy.
The noble Lord, Lord Storey, referred to the report of the SME committee, on which I had the privilege to sit. It is perfectly obvious that exports, businesses and SMEs are damaged by the lack of language skills. That was made very clear in the evidence that we took. It is also clear that there must be a more practical relationship between education generally and industry. What is the point of educating young people for jobs that are not there, when we need to educate them for the jobs that are there? The people who know what the jobs are are the people who need employees, so they should be integrated in the formation of any curriculum.
Baroness Brinton
My Lords, with the permission of the Grand Committee I will speak seated today. To cover the national curriculum in under five minutes is an impossibility so I will focus ruthlessly on maths and English, particularly at key stage 4. I remember the launch of the national curriculum. I was a parent, chair of governors of a primary school and a councillor. It seemed like a good idea: a national framework that would help deliver consistent standards and syllabuses. At least initially, it was not too constraining on teachers at the point of delivery, but all that changed very rapidly. Suddenly, reams of papers with strictures, limitations and specified methods of teaching started to arrive.
As I held the education portfolio on Cambridgeshire County Council at the time, I had the pleasure of hosting a French primary education team who came to look at our pre-national curriculum model in some of our excellent primary schools. They were impressed and said: “At least your schools have the freedom to teach what they want. In France, if it is the second Tuesday in March, you know that a 10 year-old will be on chapter 2 of the green textbook”. I fear that in the succeeding decade England has moved too much in the French direction.
The French also liked our philosophy of developing children as thinkers and independent learners. Now, a decade on, too many children are taught to the test, whether or not they have learnt the foundations beneath it. A university lecturer friend told me last week that she despairs of students who come to her and ask what they need to learn to pass. “I just want you to learn to think,” she replies.
The national curriculum should be a guide on the side, not a sage on the stage dictating every detail of what our children must learn. We should focus on pupil and student attainment and give the thousands of excellent teachers the flexibility to deliver it in the professional way that they know best. A minimum curriculum must ensure that our pupils can read and write, are numerate and have the appropriate ICT skills. Without these, they will find it almost impossible to gain meaningful employment in our knowledge-based economy. It has to be true, underlying knowledge as well, not just learnt for an exam.
I talked on Saturday to an employer recruiting graduates in the financial services sector. They had whittled down more than 160 applications to 14 that they could even contemplate shortlisting, on the basis of literacy and presentation in CVs. One candidate, a graduate with a very good degree, had written the paragraph on why they were suitable entirely in capital letters and with no punctuation. Others did not even get that far, leaving this vital personalising paragraph empty. It is no wonder that employers say that our education system is not equipping enough students with the right skills for a working life in the 21st century. Both the Minister and the noble Lord, Lord Sutherland, quoted the statistics for those who have failed to achieve the standard. My concern is that the examples I have just given would have been deemed to have met the standard.
We need a minimum curriculum to ensure that young people get those skills, and we need to broaden the offer at 16 to 19 to make it the norm for all students to achieve a level 3 in both English and maths. This might be applied English or applied maths, as are relevant for their future studies. My son, for example, did statistics in the lower sixth form to go alongside psychology, which he then read at university; that was extremely helpful to him. There could be written English for engineers and scientists, focusing on the sort of reports that they will have to learn to write later on.
The many strengths of the A-level system in depth unfortunately mean that too many students give up maths of English at 16—far too early. We are one of the few OECD countries to allow this. Even Scotland, with its excellent Highers, keeps that breadth of English and maths at 16. For some schools, the international baccalaureate does the same but I am not convinced that the EBacc at 16 to 18 will do it, because of the lack of compulsion.
The proposed key stage 4 curriculums in English and maths are challenging; taught well, they will give students an excellent foundation for later learning, whether in vocational or academic environments. They look surprisingly similar to the American systems, but the difference between our countries is that American students are expected to continue with both. Our system does not, and this explains the low take-up of maths to which the Minister referred in his opening speech. Will the Minister tell us whether the Government intend to broaden the curriculum to ensure that 16 year-olds continue with both maths and English until they leave formal education and training at 18 and/or attain a level 3 qualification in maths and English? Furthermore, will the Minister tell us whether applied maths and English courses will also be approved for those following vocational routes? It is as important for them and questions have certainly been raised about the functional skills courses that have been available in recent times.
Other speakers have rightly focused on the educational elements. The new national curriculum, which should be taught in all maintained schools, has the potential to free teachers from previous constraints, but—and it is a big but—attainment in maths and English is essential to make our young people not just employable but constructive and productive workers who are able to achieve their full potential in the UK.
The Earl of Clancarty
My Lords, I find it bizarre that a national curriculum can be so much the product of those—some might say of a single individual—who, in their day-to-day work, have such an overtly political agenda. Surely our country’s national curriculum should be in the hands of an expert independent commission, at arm’s length from Ministers. If the national curriculum still has significance when the voting age is reduced to 16—as I think will happen—there will be an even greater need for the content of national school education to be as free as possible from political interference. Will the Minister tell us whether the coalition would consider taking the planning of the national curriculum out of ministerial hands, and make it wholly independent of politics?
A school education should give students basic information and frameworks in which to work. Beyond that, it should provide them with the wherewithal to think for themselves. At least by their teens, young people should be encouraged to bring their own interpretations and thinking to bear on contemporary issues that should be part of the curriculum, including debates around climate change and gender politics, among others.
Following the theme of individual thought, with reference to the statement on page 5 of the document concerning provision for collective worship, do the Government understand the terms “collective worship” and “assembly” to be the same thing or do they consider the two things to be combined? If that is the case, the atheists and agnostics among us would still have to opt out, which is discrimination.
I agree with those who like to see English read, written and spelt well, and grammar understood. That is also useful for learning other languages. However, basic skills, especially in English and maths, should be sorted out in primary schools. What should not be the case is that the failures which the Government claim are occurring at primary school leaving age are carried by secondary schools. By that point, they should be developing students beyond the basic level.
Despite the arts community being so outspoken about last year’s English Baccalaureate Certificate plans, it worries me that in this draft national curriculum, the arts are still not regarded as being on an equal footing with other subjects such as the sciences. The arts are not asking to be treated as better than sciences, but to have parity. Art, design and music are given some space, but there is a fine balance between inordinate prescription and neglect. Apart from fleeting references on page 7, there is no mention of dance, film and animation, digital media or photography, while drama is mentioned in the English guidance notes. These are holes in the national curriculum. Along with many others, Alistair Spalding, the artistic director of Sadler’s Wells, is concerned that dance is now being left out of the PE curriculum. Perhaps this oversight can be rectified.
In terms of music, many are pleased that the Government are taking some notice. However, on 6 March at the Westminster Education Forum, the chief executive of the Incorporated Society of Musicians, Deborah Annetts, highlighted Ofsted’s own guidance that pupils should be able to,
“appreciate music through active involvement as creators, performers and listeners”.
This principle ought to be emphasised in every area of the arts, including drama. The Government should listen carefully to the recommendation of Josie Rourke, artistic director of the Donmar Warehouse, who would like to see within the curriculum every child being entitled to trips to visit cultural public spaces. One single experience at a concert, a gallery or the theatre can be worth many lessons.
The art and design curriculum has an old-fashioned and absolutist feel. It ignores the idea of critical looking and debate. In their teens, pupils can be engaged with contemporary art, which represents a significant area of modern-day visual literacy. Also, as others have pointed out, the term “great artist” should be replaced by “significant artist”. Who is and is not “great” is a part of the debate, while greatness is itself a debatable term. Will the Government say something about the Arts Council’s projected involvement in the GCSE syllabus for arts subjects? A good and practical arts education should demonstrate as full a panoply of techniques and media as possible, new as well as old. A similar criticism can be made of music, which now lacks a reference to music technology, including electronics, computers and recording.
If, as many increasingly believe, the arts and creative industries are crucial to Britain’s economic recovery, there needs to be a greater sense of urgency from the Government about the provision of an excellent and comprehensive arts education that is available to all. The national curriculum should reflect that.
Lord Quirk
My Lords, there is a great deal that I like in the new curriculum. Of course, not all that I like is new, and not all that is new is to my liking. Let me begin on the cheery side. I like the goals and the direction of travel. I like the way that vocabulary and language development are explicitly spread out across the whole range of core and foundation subjects. I also like the way that two of the core subjects, maths and English, are accorded special status; rightly so, because of their uniquely dual role in education, a point that was noted by the noble Lord, Lord Sutherland, and the noble Baroness, Lady Brinton. It is my understanding that English and maths will be taught up to the age of 18 in the event that pupils have not achieved a satisfactory level at GCSE. It is vital that we get these two subjects right.
Well, those who designed the maths curriculum seem to have risen to the challenge. We find a well thought out pedagogical progression, step by step, year by year, together with the gradual introduction of the requisite vocabulary. It is just dismaying to compare this with English, where the people responsible seem to have lost their way or never found it. They do not seem, for example, to have taken on board the clear injunction laid down when the review process began in January 2011: namely, that they should study and emulate the corresponding curricula in the world’s most “high-performing jurisdictions”, a phrase that the Minister himself used earlier this afternoon.
People at the DfE could have learnt a great deal from programmes for teaching the mother tongue in countries not as far as Hong Kong or even Massachusetts but neighbouring countries such as France, the Netherlands, and Germany. There is little sign that they even tried. There are many other and more overt defects. The most obvious is the gross unevenness: for example, dozens of pages are devoted to KS 1 and 2 while key stage 3 is dismissed with barely a wave, yet this, as the noble Baroness, Lady Walmsley, reminded us, is when puberty-fired youngsters are at their most restlessly keen to explore, and when teachers—God help them—need all the supportive guidance they can get.
Then there is the unnerving difference in expertise as we pass from one content area of the English curriculum to the next. By far the most professional is the treatment of spelling, with its formidable and convincing step-by-step progression, laid out in extraordinary detail and at extraordinary length. The treatment of grammar is far less professional, both linguistically and pedagogically. There are, I grant, glimpses of attempts at something more sophisticated than the old preoccupation with a few shibboleths, but such efforts are lost in muddle and inconsistency and dumbed down in a curious diffidence. I am told on the grapevine that the note of nervous apology is because many teachers, and teacher trainers, still hanker after the grammarless “anything goes” days of yore, when standard English was the butt of smear and sneer. Others at the DfE whisper, “No, no, it’s not that—it’s because teachers are frightened of grammar and the arcane terminology”. Well, I just do not buy that. Teachers—in many cases, the same teachers—take in their stride the no less arcane terminology of maths and science with their square roots and quadratic equations, their molecules and precipitates. They happily and confidently explain the difference between sulphate and sulphite and sulphide, so why not the difference between semantic inverses such as imply and infer? If grammar is prescribed diffidently and inconsistently, lexicology, semantics, and the vital matter of vocabulary networks seem beyond the DfE entirely.
There is no sign of linguistic professionalism to help teachers build on children’s hungry interest in naming things and finding better ways of describing them, and no sign of any step-by-step progression in enriching pupils’ word-stock. Yet this is the very soul and centre of language. Like others, I have provided the DfE with detailed criticism and, serious as the defects are, they can be speedily put right if the advice is understood, accepted and, of course, implemented.
But I am left with worries that cannot be so readily dispelled. Getting a good curriculum agreed is one thing; getting it taught across the country is quite another, as the noble Lord, Lord Storey, said. Are the many thousands of teachers in post willing to teach it and are they equipped to do so? There is much in the curriculum that will be unfamiliar to them. Then there are tomorrow’s teachers. Are our teacher-training institutions willing and—again—equipped to make the big, radical changes in what they must instil into their pupils?
Baroness Jones of Whitchurch
My Lords, I thank the Minister for initiating this debate and for giving us all an opportunity to contribute to the consultation, which is clearly important. We have had a constructive and thoughtful debate and I want to continue in that spirit because, despite the very short timescale for the consultation, we have to hope that this is a genuine exercise and that our views will genuinely be taken into account before the final curriculum is put together.
This is undoubtedly a very important debate, not just among teachers and academics but among parents, employers and young people themselves. It lays the foundations of knowledge and skills for the next generation, and it is amazing how much we are defined by the years in which we were taught at school and by how much we and the next generation take them into our working lives. You can always tell how old you are by what poems you know and what books you read at school. They instantly give you away. The national curriculum creates a national presence and culture in society. There is never a perfect solution, and whatever we come up with, we will always be criticised. There will always be competing views on either side, but it does not alter the fact that we should always have an open and inquiring mind as to how we can get the best out of the curriculum and how it can be improved.
Before I comment on the detail, I should also like to give the Minister the chance to set the record straight on who drafted the proposals. He will no doubt have read the concerns from some of the department’s advisers on the history curriculum that the final draft bore no resemblance to the versions on which they were working as late as January. Can he reassure us that Michael Gove, in a fit of overexuberance, did not personally write the final version of the history curriculum?
I should also be grateful if the noble Lord can address the essential contradiction mentioned by several noble Lords, including the noble Baroness, Lady Kidron, and the noble Lord, Lord Storey, of the national curriculum applying only to maintained schools, of which there will be a shrinking number as more and more schools become academies. If it matters educationally that the curriculum is updated, how much real flexibility are we prepared to give to academies that choose to flout the direction of the Secretary of State? At what point would Ofsted or the department intervene, and what sanctions are available if academies veer off course in a major way from what is prescribed in the national curriculum?
We share the ambitions of the Government that every child should be stretched to fulfil their maximum potential. However, we differ because we also see the immense variety of attributes and learning styles that make each child unique. We therefore reject the hothouse philosophy that underpins these proposals based on every child being crammed full of facts and examined to see how much they have been able to retain. Some children undoubtedly flourish in such an environment but, for others, learning becomes a miserable and frustrating treadmill that can put them off the whole educational experience. This is why we have major concerns about the move to revert back to exams as the sole measure of success. I was surprised to hear what the noble Lord, Lord Sutherland, had to say on this because, contrary to him, I believe that that takes a lot of teacher creativity out of the system and inevitably leads to teachers being put under pressure to teach to the test. The noble Lord seemed to imply that that was a heresy, but there is probably a lot of anecdotal evidence to support my position.
Lord Sutherland of Houndwood
I thank the noble Baroness for giving way. I absolutely agree that the heresy is actually to follow those principles rather than to accept them.
Baroness Jones of Whitchurch
Perhaps this is something for a longer debate but some teachers would say that they are desperate to escape the straitjacket of being forced to teach to the test but are literally prevented from doing so. We can all see the absolute merit of teachers being freed up to inspire and be creative in the way that they teach.
A couple of references have already been made to the academics and professionals who wrote to the Telegraph and the Independent last week. I share a number of the concerns those people expressed. They said that the new curriculum will severely damage educational standards. Without boring noble Lords too much, because I am sure a number have read the letters, I will just illustrate the point with a couple of short quotes. They said:
“The proposed curriculum consists of endless lists of spellings, facts and rules. This mountain of data will not develop children’s ability to think, including problem-solving, critical understanding and creativity”.
They also went on to say:
“Inappropriate demands will lead to failure and demoralisation”.
These themes were illustrated very well by the excellent contribution of my noble friend Lady Whitaker on the significance of design as a creative, multidisciplinary, problem-solving subject, which is really what we are looking for in terms of a progressive education but which is not really captured in the current proposals. Can the Minister comment on the widely held concerns that there is an overemphasis on learning by rote at the expense of deeper understanding and creativity in the way that the curriculum is being designed?
The consultation document also emphasises the need to learn from international comparisons. We absolutely agree that we can learn from high-performing countries and aim to do better in the international league tables. However, there is an increasing controversy about the comparisons and the conclusions that are being drawn from the data. That is why our party has resolved to remove the interpretation of the evidence from politicians and instead set up an independent body, an office for educational improvement, which will verify the research and provide genuinely well informed learning points for practitioners in the field. Can the noble Lord comment on whether he agrees that a greater degree of independent analysis would be beneficial in this regard?
Turning to the specific subject areas, I do not intend to comment on every subject, but will just pick out some key concerns which are symptomatic of our wider concerns. A number of noble Lords have mentioned history but they have not really gone into the detail, so it falls to me to do so. We accept that there is a need for pupils to have a greater grasp of the chronology of events along the timeline. However, we also agree with the critique of Professor Chris Husbands that you cannot address this by starting at the beginning of time with the youngest children and working forward, as seems to be proposed, otherwise, as he says,
“you end up with a seven-year-old understanding of the Saxons, a ten-year-old understanding of the Middle Ages and a fourteen-year-old understanding of the industrial revolution”.
More fundamentally, unlike the noble Lord, Lord Lucas, we feel that there is a concern that the curriculum is focused too much on our island history and does not have sufficient material about our global history and our interconnections.
On geography, we share the concerns mentioned by the noble Baroness, Lady Walmsley, that the debate about climate change has been cut out of the curriculum for children under 14, when many children will stop studying the subject. Young people need to understand the impact of melting glaciers, floods and drought on the physical landscape. Can the Minister advise whether this is a deliberate decision to remove the item from the curriculum?
On mathematics, we welcome the fact that personal finance, budgeting and money management are to be included and we agree that pupils need to understand the basic tools of maths. However, going back to my earlier point, there has to be a way of allowing teachers to be creative and inspiring, so that maths does not just become a memory test of facts and formulas but is something more than that.
On English, we agree that spelling, grammar and sentence construction are important. This was included in the 2007 curriculum. However, we are concerned that the shift to final exams and the removal of controlled assessment risks undermining the teaching of speaking and listening skills, which are critical to the world of work. Perhaps the Minister will comment on how these skills will be assessed in future.
Finally, we share the concerns mentioned by several noble Lords about the long-awaited PSHE review giving so little direction to schools on issues that are crucial to the health and well-being of young people.
We will continue to engage on the future curriculum, but we believe that flawed thinking undermines the proposals. At its heart is the assumption that every child must pursue an academic career. We take a different view. We see the rise of the leaving age to 18 as a great opportunity, so we are developing plans for a gold-standard set of qualifications that test academic, practical, creative and technical learning up to 18. We are taking the time to get these proposals right. This includes engaging with employers.
I realise that my time is up. I reiterate my thanks to the noble Lord for this debate and look forward to his response.
Lord Nash
My Lords, I thank the noble Baroness, Lady Whitaker, for her detailed comments on design. I very much hope that she will feed them into the consultation. We recognise the concerns raised about design and technology study programmes. We are listening, and working with the subject community and the Design and Technology Association to improve the draft.
I thank my noble friend Lord Storey for his comments, in particular about the primary curriculum, an area in which he is extremely expert. It is a delight to hear someone who has spent so much time teaching children rather than thinking about theories of education talking about what it is appropriate to teach children. I am particularly grateful to him for laying off history today, and for supporting our move to give teachers more freedom.
The noble Lord asked about teaching sex education at key stage 3. Aspects of the biology of reproduction and the human life cycle are included in science in key stage 2. It is up to primary schools to decide whether to provide additional sex and relationship education, taking into account the views of parents. Many schools choose to provide sex and relationship education in year 6.
I am grateful for the comments on soft skills made by the noble Lord, Lord Northbourne. As he knows, I share his views about their vital importance. As noble Lords are aware, the outcome of the PSHE review was announced last week. PSHE remains an important and necessary part of all pupils’ education, but teachers need flexibility to deliver high-quality PSHE and are best placed to understand the needs of their pupils. This will not come from additional central prescription. Therefore, PSHE will remain a non-statutory subject, without new standardised frameworks or programmes of study. My honourable friend Elizabeth Truss wrote to Sir Michael Wilshaw last week, asking Ofsted to draw up a guide to effective PSHE practice.
Aspects of PSHE will continue to be taught throughout the statutory curriculum. In science, pupils will learn about the structure and function of the male and female reproductive systems, and the menstrual cycle. In both science and PE, children will learn about the benefits of a healthy lifestyle, including the impact on the body of diet, exercise and drugs. In maths and citizenship, children will receive financial education, including learning about wages, taxes, credit and debt. In designing appropriate PSHE content for school curricula, teachers will be expected to build on content in the national curriculum on drugs, finance and health education, and on the statutory guidance on sex and relationship education.
All schools today have to focus more on PSHE. With the collapse in many areas of family life as a result of the high incidence of absent fathers, the absence of religion in many children’s lives and the prevalence of gang culture, the only constant in many children’s lives—the only brick—is their school. All children in the modern world face a variety of issues and schools have to do much more on what was called the pastoral front than they used to. This is meat and drink to good schools and we expect all schools to emulate what the good ones do. We trust teachers and head teachers to adapt what they do to their own particular circumstances. We are not arguing about the necessity for PSHE, and no one feels more strongly about the need for it than I do, having seen the effect at first hand of what really good pastoral, inclusion, behaviour and raising aspirations programmes, which of course include PSHE as a part, can have on disaffected children. However, we do not feel that it is appropriate to legislate for it. We should leave teachers free to teach what is appropriate to their circumstances. However, we have asked a specific question in the consultation about our proposed aims for the national curriculum and we will take all views into account before finalising them.
My noble friend Lord Black of Brentwood commented on animal welfare. It is not the role of the national curriculum to prescribe everything that might valuably be taught to children. We are slimming down the national curriculum to focus on essential knowledge in core subjects. The draft primary science curriculum requires pupils to be taught about the needs of animals, including food, water and so on, and the care of animals is something that we would expect all good schools to cover in their wider curriculum as part of the soft skills. However, we will look further into this matter.
The noble Baroness, Lady Coussins, talked about languages. The evidence shows that we have a strong basis on which to build the new expectation that foreign languages will be taught in primary schools. A recent survey conducted by the CfBT Education Trust, the Association for Language Learning and the Independent Schools’ Modern Languages Association found that 97% of primary schools are already teaching a language, and that more than 80% are reasonably confident about meeting the statutory requirement for 2014. Evidence, including some from other countries, shows that children benefit from being taught languages at an early stage. They can inspire children with a love of language that will stay with them throughout their secondary education and beyond. For this reason, we are opening up the choice of languages beyond European modern languages by including Mandarin, Latin and Ancient Greek. It is right that we give our pupils this opportunity and provide a better foundation for the teaching of languages in secondary schools.
We will not be making languages compulsory at key stage 4 because we are conscious of the need to slim down the curriculum and allow schools the freedom to meet their pupils’ needs. However, to support the introduction of the new key stage 3 second language education, the Teaching Agency is facilitating an expert group chaired by a leading primary head teacher for languages and bilingual education. The group is meeting at the moment to develop the signposting of resources and the identification of high-quality teaching materials that are freely available and is looking at ways in which initial teacher training in schools can best prepare for the introduction in 2014. On schools becoming academies to avoid language teaching, we welcome schools becoming academies, but we are not encouraging them to do so for this reason. The national curriculum should be a benchmark for all schools. Academies would have to justify to their communities if they chose not to teach what all other maintained primary schools do at key stage 3.
My noble friend Lady Walmsley made a point about language experience courses in schools, which of course they are free to run. I am also grateful for her comments about cooking and IT. On IT careers advice, we expect all schools to engage with their local business communities for careers advice in IT and other industries.
I turn now to the subject of climate change. It is not true to say that climate change has been cut out of the curriculum. It is specifically mentioned in the science curriculum and both climate and weather feature throughout the geography curriculum. Nowhere is this clearer than in the science curriculum for 11 to 14 year- olds, which states that pupils should learn about,
“the production of carbon dioxide by human activity and the impact on climate”.
This is explicit coverage of the science of climate change. It is at least as extensive and certainly more precise than the current science national curriculum for this age group, which states only that:
“Human activity and natural processes can lead to changes in the environment”.
In addition, the Royal Geographical Society has said that the draft geography programme of study will provide,
“a sound underpinning of factual knowledge to prepare, at GCSE and A level, for pupils to study the topics that confront us all, globally, as citizens and which are inherently geographical, such as climate change, pollution, ‘food, water and energy’ security and globalisation”.
On academies not teaching the national curriculum, it is true that they have the freedom to vary any part of the national curriculum that they consider appropriate. However, even in a school system where more and more schools are moving towards greater autonomy, there is still a need for a national benchmark to provide parents with an understanding of what progress they should expect and to inform the content of core qualifications. Of course, academies and free schools must prepare their pupils for national exams and will be judged in part by destinations.
I am grateful to my noble friend Lord Lucas for his comments, particularly on the importance of the broad sweep of history and the opportunity now facing us with design and technology in schools.
I thank the noble Lord, Lord Sutherland, for his Mr Micawber-like comments on the need not to crowd the national curriculum. On his point about Ofsted, I have already talked about the PSHE review. Ofsted inspects for a broad and balanced curriculum and for progression. Without good PSHE, progression can be difficult for some pupils. However, Ofsted is the sharpest tool in our box and I undertake to discuss this further with Sir Michael Wilshaw.
The noble Lord, Lord Empey, commented on the lack of incentives for computer science graduates to enter the teaching profession. We are providing a £9,000 bursary for computer science graduates. The British Computer Society-Chartered Institute for IT is offering scholarships of £20,000 to exceptional candidates. The UTCs and studio schools programme is about encouraging more young people into the technical industries.
I thank my noble friend Lady Brinton for her comments about the inadequacies of the current system. On maths and English post-16, students who have not achieved at least a GCSE grade C in English or maths at the age of 16 will be required to continue to study mathematics post-16 from September 2013. We also want to encourage schools and colleges to provide opportunities for students who have already achieved a GCSE grade A to C to continue with the study of mathematics at level 3 as part of their post-16 programme. We are developing new courses for this cohort, and work is under way with Ofqual, mathematics sector bodies and awarding organisations to determine the most appropriate format for these new core mathematics qualifications.
I thank the noble Earl, Lord Clancarty, for his comments about primary schools. He is quite right that education often goes wrong in primary schools. That is why we are focusing on the most underperforming primary schools. On trips to cultural places, that is something we expect all schools to do.
I thank the noble Lord, Lord Quirk, for his comments about teachers. He raises a very good point. All schools will have to focus on training their teachers for the delivery of the new curriculum. I thank the noble Baroness, Lady Jones, for her opening comments about how one can never get a draft of a curriculum that pleases everyone. On the authorship of parts of the history curriculum, as the noble Baroness knows, the history curriculum was drafted with the input of a great many experts in the field. We were very pleased to see 15 eminent historians, including David Starkey, Niall Ferguson and Antony Beevor, endorse our approach in a letter to the Times on 27 February.
On academy freedoms and the national curriculum, academies were allowed under the previous Government not to teach the national curriculum. If the Labour Party wants to change that, I would be interested to hear about it. On plans for an office for educational improvement, of course we agree with the principle of evidence-based policy. That is what we have been doing, and plenty of evidence is available. However, we are not convinced that the noble Baroness’s approach of setting up a new quango—no doubt at great cost—is necessary.
Turning to the content of the history programme, I reiterate the importance of giving our pupils a clear chronological narrative of British and world history rather than a disconnected set of themes and topics, often repeated, as is the case currently with for instance Nazism, over the course of their school careers. It is right, too, that the teaching of history should cover significant individuals who have helped shape the history of Britain and the world. Those names listed in the programme of study are just some of the individuals we expect schools might cover. It is not a definitive list, and teachers are free to teach about any other individuals or aspects of the history of other countries and cultures as they see fit to meet the needs of their pupils. It is clear that the history curriculum generates a wide range of views about what pupils should be taught, and it is right to have that debate. I also acknowledge that others might have made different choices, but that is why we are consulting on the programme at present and welcome responses from all parties.
The noble Baroness, Lady Jones, made a comment about vocational education. One of the Secretary of State’s first acts was to commission the Wolf review, which we have implemented in full. We also commissioned Doug Richard to look at apprenticeships and are taking his proposals forward.
I must comment on the rather sensational latter which was recently written by 100 academics. They are of course right that we want our students to learn higher-order thinking skills, but those academics, I am sure, would acknowledge that to progress to that level, students need a basic grounding in lower-level skills and in knowledge. Sir Michael Wilshaw has—
Lord Sutherland of Houndwood
I just wonder whether the Minister has noted that my noble friend Lord Quirk and I have both chaired meetings with more than 100 professors in them. They were called senates and they did not always fill us with confidence that the judgment coming out was the right one.
Lord Nash
I am obliged to the noble Lord, Lord Sutherland, for that comment and have to say that I rather sympathise with Sir Michael Wilshaw, who has encouraged people like that to get out there and see what is happening in many of our classrooms. Once you have done that, only then can you appreciate how vacuous the content is that is being taught in many of our schools and how we need to improve the national curriculum in order for pupils to progress to a higher cognitive level.
As I outlined in my opening speech, the draft national curriculum on which we are consulting is based on careful analysis of the world’s most successful school systems. That showed that our curricula, in particular for the core subjects, focuses insufficiently on key knowledge and is less demanding than in other jurisdictions. The new national curriculum will change this and will also give schools more freedom over the curriculum and teaching, not less. The new national curriculum acknowledges the vital role of knowledge in education and is based on up-to-date, cutting-edge research about how the brain learns. It lists the important knowledge pupils need to know within clear subject taxonomies. To quote the leading US cognitive scientist, Dan Willingham:
“Data from the last 30 years lead to a conclusion that is not scientifically challengeable: thinking well requires knowing facts, and that’s true not simply because you need something to think about. The very processes that teachers care about most—critical thinking processes like reasoning and problem solving—are intimately intertwined with factual knowledge that is in long-term memory (not just in the environment)”.
Indeed, how interesting would debates in your Lordships’ House be if noble Lords did not have huge reservoirs of factual knowledge stored in their long-term memories which they use to display high-order skills such as argument, reasoning, analysis, comparison et cetera? The curriculum does contain lists of facts but these facts are not opposed to higher-order thinking and the skills of analysis and creativity; rather, these facts enable such skills and provide a framework of understanding.
In every field of human endeavour it is accepted that you must know the rules of that field before you can produce anything of worth within it. Great artists and writers know their rules before they break them. Great scientists and mathematicians know the work that has gone before them. This curriculum provides the foundational knowledge that will stand our future artists, writers, scientists and mathematicians in good stead, while also allowing all pupils to appreciate the great achievements of the past.
I thank noble Lords for their valuable contributions to this important debate. As I mentioned earlier, the consultation on the draft curriculum will close on 16 April and we welcome responses from anyone with an interest. Subject to the outcome of the consultation, we then plan to publish the final curriculum in Autumn 2013, to allow time for schools to prepare for the first teaching in September 2014.
EUC Report: MiFID II
(11 years, 8 months ago)
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Lord Harrison
That the Grand Committee takes note of the Report of the European Union Committee on MiFID II: Getting it Right for the City and EU Financial Services Industry (2nd Report, HL Paper 28).
Lord Harrison
My Lords, I am delighted to have the opportunity to introduce this debate on the report of the European Union Committee entitled MiFID II: Getting it Right for the City and EU Financial Services Industry. This report was based on work undertaken by the Sub-Committee on Economic and Financial Affairs, which I have the honour to chair. The report was published in July 2012, and was based on evidence received from a number of practitioners and experts in the operation of financial markets. The committee was also assisted in its work by Professor lain MacNeil, Alexander Stone Chair of Commercial Law at the University of Glasgow, who acted as specialist adviser for the inquiry. I thank him and all the witnesses who contributed so richly to this report.
This proposal for a directive and regulation on markets in financial instruments is a complex legislative package, as our seven-page glossary indicates, but it is also extremely important. The original MiFID package, which came into effect in November 2007, is the foundation of the EU regulatory framework for investment firms. These firms encompass a wide range of activity such as global investment banks trading complex securities, fund managers investing pension funds, stock-broking firms and small high street financial advisers providing financial advice to the general public. The Commission’s objectives were to open up trading in securities to competition, to apply equivalent regulatory rules to different market models which perform similar functions and to enhance, standardise and harmonise investor protection across the European Union.
The new proposal, known as MiFID II, seeks to respond to deficiencies in the MiFID I regime exposed by the recent financial crisis. It focuses in particular on addressing problems that have arisen from the expansion in over-the-counter (OTC) trading, including the transparency of such trading. It seeks to shift trading from the more opaque OTC market to more transparent organised markets, in line with the September 2009 G20 commitment to tackle the less regulated and more opaque parts of the financial system by the end of 2012.
The committee’s starting point was to ask whether a review of MiFID I was even necessary. We found that it was, particularly given the technological advances that had taken place since it came into force. Some witnesses told us that the Commission’s proposals were a “good starting point” for negotiations. However, we warned of the damage that would be created by hastily or poorly drafted legislation. These concerns were heightened by the evidence we heard that, while some of the proposals were based on sound principles, there were significant flaws in the Commission’s draft. We identified six such central flaws.
First, we warned that the proposal for a new category of organised trading facility risked creating an overly complex regulatory framework which did not distinguish clearly between organised venues and OTC. We feared that the implications of the proposal had not been fully assessed. We were particularly concerned about the proposal for a ban on “own capital”—that is, the ability of the trader to use his or her own resources to trade on other people’s behalf—and the amount of detail left to delegated acts.
Secondly, while the post-trade transparency provisions held much merit, the pre-trade transparency proposals did not take into account the markedly different characteristics of each sector of the market, particularly in terms of liquidity. The requirement for disclosure could compromise the ability for competition to flourish. We warned against a one-size-fits-all approach to transparency that could have a negative impact on bond markets. We called for a more flexible approach that, while recognising the benefits of transparency, would allow the market to operate effectively.
Thirdly, the Commission also proposed to regulate algorithmic and high-frequency trading. HFT remains a deeply controversial activity and there is a wide spectrum of views about its utility. We recognised the case for circuit breakers, but were concerned that the scope of the proposals was too broad and did not adequately differentiate between algorithmic trading and high-frequency trading. In particular, we warned that the proposal to require algorithmic trading strategies to be in place throughout the trading day was likely to have a detrimental effect on financial markets.
Fourthly, the Commission’s proposals on third country access were deeply flawed. They created a risk that third country firms could find themselves locked out of EU markets, creating the spectre of regulatory retaliation. Such effects could have a particularly damaging effect on the City of London. At the very least, lengthy transitional regimes for existing third country firms were required.
Fifthly, the Commission proposed a number of steps to strengthen investor protection and corporate governance, yet the proposal to restrict the ban on inducements to independent advisers was in our view unworkable, since advisers would simply take steps to avoid being classified as independent. Likewise, the Commission’s proposals on corporate governance were overly prescriptive and did not take account of the diverse size, capacity and business models of the range of market participants.
Finally, we found that, while the European Securities and Markets Authority had a vital role to play in co-ordinating regulation of financial markets across the European Union, there was less consensus about the degree to which it should engage in direct regulation of the financial markets, as suggested in the Commission’s proposals for ESMA to take on product intervention powers. In the light of these flaws, we urged the UK Government, the Commission, the Council and indeed the European Parliament to take all the steps necessary to ensure that the legislation was fit for purpose before it came into force.
What has happened in the nine months since our report was published? The Government’s response, received in October, expressed sympathy with many of the points raised in our report, and we are grateful to the Financial Secretary to the Treasury, the right honourable Greg Clark MP, for keeping us updated on negotiations in the months since. We are aware that negotiations have moved forward, and that significant amendments have been advanced. For instance, progress has been made in Council on improving the provisions on third country access, although we understand that the European Parliament continues to take a contrary view. Perhaps the Minister might tell us a bit more about that. We are grateful to City UK for sending us extra material that will be valuable to us in our thoughts on third country access.
What update can the Minister give us on the progress of negotiations in relation to the six areas of concern that I have identified? What is his understanding of the European Parliament’s position on these issues? To what degree does he believe that the concerns that we raised, and which the Government have said that they share, will be addressed in the redrafted legislation? In relation to HFT, what is his assessment of the findings of the Foresight project, published in October 2012? On a personal note, I am still considerably worried about HFT, although the Foresight group took a much more relaxed view. What is the Minister’s view?
It has also become clear from the Minister’s correspondence that the timetable for agreement had been pushed back, with the scheduled agreement in Council repeatedly postponed. We understand that the Irish presidency decided not to take MiFID to general approach at ECOFIN on 5 March because a number of issues remained open. Which issues remain contentious, and what update can the Minister give us on when agreement on the package will be sought?
MiFID II’s impact on European financial markets, not least the City of London, will be considerable. The Government and their European partners must do all that they can to ensure that the financial markets, and the economies that rely on them, are strengthened rather than undermined by these provisions. However, MiFID II must not be viewed in isolation. There are other pressing issues whose impact on the City, the UK and the EU as a whole are just as great, if not greater.
Last year my sub-committee also conducted an inquiry into the Commission proposals for a financial transaction tax. Contrary to the opinion of many so-called experts, the idea has not died but remains very much alive, in the form of a proposal by 11 European Union member states to introduce a tax under the enhanced co-operation procedure. Only last week, witnesses to my sub-committee told us that the political will in the EU behind this proposal had been underestimated. Indeed, I recall that the CBI spokesman Richard Woolhouse told us that there were now stirrings of recognition in the City that the FTT in its enhanced form could indeed come about.
Do the Government share the complacency we identified? What steps are they taking to ensure that a full and effective analysis of the effects of such a tax on the UK will be conducted? The Minister might like to know that, this afternoon, I talked about this with Mr Lidington, our Minister for Europe, and I tried to sound the alarm bells. As an expert on the City, he will know of some of the new elements introduced in the issuance principle which mean that those trading in, for example, Volkswagen shares in two non-participating countries could be subject to the tax. London could have a much greater responsibility in terms of collecting the tax, perhaps for participating countries.
The euro area crisis has not, of course, gone away. In February, my sub-committee wrote to the Financial Secretary to the Treasury, reporting on the assertions of some experts that the worst of the crisis was over. We were sceptical. We warned that,
“the biggest enemy in the current climate is complacency, whether it be that of European leaders that the euro area has definitively turned a corner, or whether it be that of observers in the UK that the implications of these developments for the United Kingdom can be safely ignored. Positive signs of progress there may have been, but there remains a long way to go before the euro area crisis can be judged to have come to an end”.
I regret to say that recent developments in Italy and, more particularly, in Cyprus have borne out our judgment. The inconclusive Italian election results were a clear demonstration of the political and social pressures to which the euro area crisis is giving rise. More alarming still is the crisis over the Cypriot bailout. The way in which this issue has threatened to spin the entire currency zone back into crisis mode is a clear demonstration of the perils of complacency.
These issues demonstrate the vital importance of the UK Government remaining at the heart of EU discussions, whether it be on the euro area crisis, proposals for a financial transaction tax, or the MiFID II package. The Government may not agree with all the proposals, nor wish to participate in them, but the UK is not immune to the effects that overspill on to us. On MiFID II, as on all these issues, the Government must remain at the negotiating table, ensuring the best possible outcome not only for the City and the UK, but for the EU as a whole. We need to find friends in Europe to be able to do that important and sometimes desperate task. I beg to move.
Lord Hamilton of Epsom
My Lords, the noble Lord, Lord Harrison, made reference to the technical advances mentioned in our report, and the problem is that, as we all know, technology moves on. I am absolutely sure there is going to be another financial crisis, possibly as big as the one we have just seen; I am absolutely convinced that we cannot anticipate today what it is going to be. One of the weaknesses of regulation and moves such as those that have been made by the EU is that they definitely involve closing the stable door. You can always guarantee that the next financial crisis will be different from the ones we have seen in the past. I suspect that, if we are looking for a solution to this, we have to look to very agile national supervisors, because I do not think that the EU is in a position to stop this sort of thing happening in future.
I would like to move on to the slightly wider issues which the noble Lord, Lord Harrison, touched on, namely the financial transfer tax. Students of the Bible will remember that the Pharisee used to get up in the morning and say, “Thank God I’m not like other men”. I get up every morning saying, “Thank God I’m not a Europhile”. If I were, I would feel that the European Union was letting me down extremely badly. Its attempt to deal with a financial crisis has been so ham-fisted that it really makes one doubt its capacity to run anything at all.
The reality is that the financial transfer tax will be incredibly damaging to the eurozone and the financial institutions within it. It will reduce liquidity in eurozone companies; clearly, if you are going to tax transactions in shares, people will just not buy and sell those shares as much as they otherwise would. It will make it attractive for a number of them to relocate to markets elsewhere in the world where they do not have to pay the tax, and it will make it much more difficult for the EU to raise money. It defies all credibility that it should want to do this.
Mr Bergmann, the deputy to the Commissioner who deals with all this in Brussels, came to see our committee and said that when 11 countries entered into this agreement, they would set an example to others that would then follow. If you believe that, you will believe anything. The fact is that the United States would never follow down the road of having a financial transfer tax, and I very much doubt that Hong Kong or Tokyo would either. There is therefore never going to be a global financial tax; all that you might ever have is one or two more countries within the EU joining in with it.
One of the issues that came up during our discussions on this today was the big question of whether companies in the City of London would be forced to collect the tax on behalf of the European countries that were involved in the shares that were being traded. We were left completely confused because Mr Bergmann told us categorically that there would be no question of City firms collecting this tax, but on the other hand it seems that there is serious evidence that the plan is that it should be collected on behalf of other Governments. I know that the Minister cannot reply on that now, but it would be nice if he could search that out for us and try to get a definitive reply on where we stand on it; it is a fundamental question for the City of London.
Another reason why I am glad I am not a Europhile is the whole management of the economic crisis, which has been absolutely abysmal. It is now more than 12 months ago that my right honourable friend the Prime Minister said that what Europe should do was get a big bazooka to solve the problems facing the eurozone. Chancellor Merkel was adamant: she was not going to expose the German taxpayer to picking up all the liabilities of the Club Med countries and the others that the Germans consider have not got their act together at all. A year to 18 months later, that is precisely what happened: the ECB got authorisation from the Germans to buy bonds in the secondary market across the whole of the eurozone. The result was that the crisis that there had been in funding government debt across the eurozone was completely stabilised overnight. It is quite interesting that to date the ECB has not had to buy any bonds in the secondary market of the eurozone, yet that stability has been brought about.
So what has happened in the mean time in the intervening 12 to 18 months? Chronic insecurity has spread across the whole of the eurozone, and people who might have made investment decisions have sat on their hands and done nothing. The result is that we have seen a much severer recession in the eurozone than we would have seen if that decision had been taken earlier. No doubt there were a whole mass of political reasons in Germany as to why Chancellor Merkel could not move quicker, but the fact remains that if that nettle had been grasped earlier, the eurozone would not have had as severe a recession as it has seen just recently. That recession has even spread as far as Germany as well. It is quite possible that Germany may pull out of it quite quickly but the fact is that the inactivity by Germany actually put that country into recession, which it has not seen for quite some time.
Now of course we see the Cyprus crisis being dealt with on the basis that the Cypriots themselves should pay a very serious price for the trouble that their country has got itself into. An amazing scheme was originally produced that said that all deposit-holders in banks in Cyprus should pay a tax. It had to be described as a tax because, as everybody knows, the EU has been working for some time on a deposit insurance scheme that means that people holding up to £100,000 in a bank will have that money secured. Somehow, when the whole country goes bust, your deposits are at risk, but if your bank goes bust your savings are secure. Come on—people are not going to sit there and say, “This raid on my savings is quite legitimate because it is a tax”. That decision has now been reversed and we are going to see deposit-holders above €100,000 maybe being taxed at 40% on their holdings.
What effect is this going to have on many of the other very unstable Club Med countries in the eurozone? Jeroen Dijsselbloem, who is the president of the Eurogroup, although I gather he has not been there for very long, came out with an incredible statement only yesterday, I think, saying that what had been done in Cyprus was a template for all the other countries in the eurozone. Can you imagine a more crass and stupid remark than to say that this was a template to be applied elsewhere? What it immediately does is put the frighteners on absolutely anybody—any company or any individual—who holds a bank account with money in it in any country such as Spain, Portugal, even Italy and certainly Greece. Greece is completely unstable. It is completely recognised that it is unsustainable as it is and that it cannot go on. The reason why nothing has been done about Greece is because German elections are coming up on 22 September. After that, they will want to restructure the whole debt of Greece. They will have to do it yet again and the Greeks will have to take another massive haircut. Any Greek who is standing around at that point with money in a Greek bank needs to have his head looked at. You are actually better off taking the money out and stuffing it under the mattress than you are leaving it in a bank account, where they can impose a tax on it.
This is absolute lunacy. Once again, I hate to say it, but this is why I am so glad that I am not a Europhile, because it strikes me that these people cannot run anything competently whatever. The choice for the future of the eurozone is quite simple. It can go mutual so that the rich countries have to guarantee all the poor ones, but the Germans are flatly refusing to do that and, if they do not, it is going to break up. As night follows day, the weak countries are going to go, and then eventually it will get to the centre and some of the stronger ones will go as well.
If the Germans did decide to underwrite all this, with some eurobond or something of that sort, then of course you have a future made up of fiscal transfers from the rich countries to the poor. We have seen a bit of that already with the so-called bailouts and so forth. They are bitterly resented by the Germans, who have to pay them; and because of the conditions with which they arrive in Greece, say, they are bitterly resented by the Greeks, who get the bailout.
With fiscal transfers, you will only have that continuing but writ large. This then of course encourages extremism in places such as Greece and very nasty parties start to crop up. If we go on like this, the whole of this system will just not work. The best thing that could possibly happen would be if the Germans pulled out of the eurozone and created, with other sensibly run countries within the eurozone, a strong currency which can actually survive. If we go on the way we are now, chaos beckons.
Viscount Brookeborough
My Lords, as a member of Sub-Committee A, chaired by the noble Lord, Lord Harrison, I pay him due credit for producing this report on such a complex issue. I also commend the clerk and our policy adviser who have managed to produce a document that, although complicated, is just readable by those who are fairly fanatical about it.
During the past 25 years, I have served on several EU sub-committees, including those on agriculture, environment, industry and transport. Controversial and tricky subjects they may be, but they are nothing like as complicated as those that we are dealing with in Sub-Committee A on economic and financial affairs. As our chairman pointed out, although it may not have been in his draft, you have only to look at the glossary at the back to see what we all need—seven pages of unheard of and unspeakable letters and descriptions. I joined the committee only last year and, after attending my first meeting, I left feeling numb and as if my brain had been scrambled. The subject was incomprehensible and it took me a while to get my head around it. I am afraid that I still lag somewhat behind.
Simply put, MiFID II is about two things, regulation and transparency. The latter includes greater understanding of the markets by everyone; but, most importantly, it relates to those who invest, insure and trust others with their funds. There are perhaps two groups. First, there are the very large pension funds, corporate businesses and plcs, among others. Then there are individuals—Joe public. During the past 40 years, millions of people have become small shareholders, encouraged by government privatisations, including those of the rail industry and BT. In addition, availability of private health insurance and private pension plans have become the norm. Some of these people can afford brokers and have access and the ability to understand the working of the financial markets. However, the majority numerically are small investors—private individuals ranging from those in lower income groups to the wealthy.
I should like to consider them for a moment, especially those who use independent advisers rather than City brokers. It is most important that this is a reliable and easy-to-understand service for those who cannot afford anything else. For one moment, I will assume that Christian Krohn of the Association for Financial Markets in Europe was correct when he said that MiFID I provides adequate small-investor protection.
However, I should like to discuss the proposed ban on inducements and commissions to independent advisers alone. Guy Sears of the Investment Management Association questions the effect of the proposal, and I am inclined to agree and, indeed, report that we do not think that it is workable. In addition, I am not quite sure that the inducement/commission is important, providing that the product is genuine and the client knows that he or she may go elsewhere to compare prices and, most importantly, compare potential outcomes. Surely the commission is no more important to a client whether he or she is buying a financial product or a car. It is the results of the deal as a whole as they appear to him or her that count. When you buy a car, you decide on a product, shop around and get the best deal, which may include free servicing or whatever. You do not ask the salesman what his bonus is or what margin the garage is making. It may be that it remains a cheaper or better option to buy from him, even though his bonus and margin are higher than that of the garage next door. Banning inducements or declaring them in every case may upset the market—the only market available to the group of people of whom I am talking. It is a people’s market. If this market fails or becomes more difficult to access, where will ordinary citizens in the EU, including the majority of the 70 million individuals in the UK, be able to go for this service? We must be conscious of this. We know that the national pension schemes and provision of healthcare will be insufficient with our increasingly aged population. Our Government must focus on this and the future problems arising from it.
The problem with much financial services business is that it is so complicated and, unlike other businesses, takes place in the ether, rather than in the practical trading of normal products such as grain, mining products or manufactured products. Those involved work on, oblivious to the fact that the industry is incomprehensible to most people outside their world. Europe adds bureaucracy to this and thinks that “one size must fit all” means that Germany’s size is the one that must fit.
The magic word seems to be “harmonisation”—do it my way rather than compromise and use delegated regulations. Look at the financial transactions tax. We had Herr Bergmann, the director of the EU tax department, in front of our committee the other day. When asked what the main objectives of the FTT were, he said, first, harmonisation and, secondly, raising money. They are hiding behind the soundbite of harmonisation; it would be good for us all, they say. Surely the first objective of any tax before you can even think of harmonisation is to raise money. That is the next stage, papering over the cracks later on, but they have put it first because of the way that it sounds. The initial deal for the Cyprus bailout just demonstrates how confident and secure one of our nations feels to put such a proposal on the table. Next they will call for the harmonisation of this tax—and where next? Incidentally, as a colleague of mine said, the only people who have taken money out of the bank in that way were the IRA in Belfast. Charles Moore wrote in the Telegraph yesterday:
“Cyprus is only the first victim of a one-size-must-fit-all-policy that is made in Berlin”.
In conclusion, my impression after being on the committee for a year is that this area is highly complex and few people outside the City could begin to understand it. In other committees that I have sat on, witnesses invariably feel that they have the right answers. In our deliberations, however, our witnesses have said that they hope so, they do not know the full answer for sure or, “This will not necessarily stop a future crisis”. It is pretty unnerving to listen to experts in that frame of mind.
The City of London, one of the big three, is crucial to our nation. Our invisible earnings are such a high percentage of our GDP, yet my impression is that the City is too busy keeping up with the speed of its trading and recession management to look forward to the unintended consequences of developments in Brussels. Yet the Government seem far too relaxed and are doing little to fight London’s corner. In contrast, I am delighted to see that the Government are putting £2 million towards aerospace research and development at Bombardier in Belfast, but surely they must wake up and get cracking on the financial world and support it as they should. I have not asked specific questions but our chairman has done so, and I look forward to the answers.
Lord Kerr of Kinlochard
Since this is the last report from the committee chaired by the noble Lord, Lord Harrison, to be debated this Session, I should start by paying tribute to him. I have learnt a great deal from serving on his committee. We have benefited from his huge experience, linguistic skills, total impartiality and unfailing good humour. One of the reasons why it has been rather a productive committee is that it has been extremely well chaired, and I thank him. I also thank our clerks, Rose Crabtree and Stuart Stonor, the latter a man of astonishingly fertile mind, deserving of congratulations on his output.
On the matter that we are discussing today, I thank the Government for maintaining a civilised dialogue with us. The government response to our report was a serious point-by-point reply, and at all stages the discussion with the Government has been informative. I hope that what we have said has proved helpful. I contrast the Government’s response with that of the Commission, which always replies to our reports but in this case sent a particularly deadpan response. The Government sent a very interesting and helpful one. Why am I saying this? To make a point, of course. On this matter, the Government have maintained a dialogue with us, but on the matter which has been raised by all previous speakers in this debate because it worries us the most, the financial transactions tax, there is a complete dialogue of the deaf with the Government. We are unable to persuade Mr Greg Clark to engage with us. Our correspondence with him is wholly unsatisfactory, and he has still to address the key point we raised in our report—a much larger and more substantive report than the MiFID report—exactly a year ago.
I would like to take advantage of this debate by putting six questions to the Government about the financial transactions tax. First, do the Government agree that the enhanced co-operation of 11, if implemented, will damage the European Union? Secondly, do they agree that the enhanced co-operation of 11, if implemented, will damage the London market? Thirdly, if so, why did the Government abstain at the January ECOFIN? Why did they not oppose the proposed enhanced co-operation? Fourthly, did they seek before then, and are they seeking now, to construct an alliance against the enhanced co-operation of 11 among our natural allies not participating in it—the Dutch, the Danes, the Swedes, the Poles, the Finns, the Irish and the Luxembourgers? It is not Britain against the rest; we have a majority on our side. Are we making use of that? Is there any active diplomacy?
Fifthly, did we seek and are we seeking legal advice on whether the conditions laid down in the treaty for permitting enhanced co-operation are met, given that these conditions include the need not to prejudice the interests of non-participating member states? Sixthly, why did the Prime Minister at the European Council this month merely take note of this pernicious proposal? According to its conclusions, the European Council noted it. I do not know how well briefed the Prime Minister was. Can the Minister confirm that the Prime Minister is fully briefed on the damage that the FTT proposal could do to the European Union and to the United Kingdom?
Now, to follow the example of the noble Lord, Lord Harrison, I am going to revert to my usual bonhomie and to the subject of this debate. MiFID II is the grandson of the original 1993 investment services directive, on which I was one of the negotiators. Our aim was and still is to create a single market in financial services, which is of course massively in the UK’s interests since the UK is the principal EU provider of such services; they are our largest export; and our share of the EU market has grown as the internal barriers have come down. That is what we hoped, and it is what has happened.
The particular purposes of MiFID II are to create greater competition in trading in securities in order to reduce costs for investors, to apply equivalent regulatory rules to different market models and to enhance and harmonise investor protection—all plainly worthy aims that are beneficial to the EU and the UK. However, the devil lies in the detail. As our report shows, and the Government have agreed with us, we need to be in there fighting. I believe that on this subject, unlike the financial transactions tax, the Government have been in there fighting and that UK negotiators have done very well. It is very important that UK negotiators have been present. Let us suppose for a moment that we were in the nightmare situation of Norway. Let us suppose that we were country members of the single market and we had to take the rules, written in Brussels in the sort of process that we are talking about today, from the fax machine when they had been completed with no say in what they said.
As I say, the Government have done well and the chances are that MiFID II is going to come out okay. However, I have a two-part question for the Government and a comment. My particular concern about MiFID was with the provisions for third-country access, as discussed by the noble Lord, Lord Harrison. The committee thought that they were deeply flawed, and the Government agreed. The proposal was that third-country firms would have to register with the European Securities and Markets Authority and could trade in the EU only if authorised to do so by ESMA, which would be required to certify that these third-country firms came from countries whose home-country jurisdiction imposed requirements equivalent to those in MiFID II and provided equivalent reciprocal recognition of EU firms. Try selling that on Wall Street. It would not fly there, and the effect would be to restrict third-country access into our markets, which would be damaging to them and to us. Clearly, this amounted to a significant risk of shrinking the EU market and hence the London market, since it is the premier location for third-country firms and their branches.
The Commission, which, as I have said, replied to our report, was a little bland on this point. It said:
“The Commission’s objective is to ensure that EU financial markets remain open but are safe for investors … The Commission’s proposal is, therefore, mindful of the need to achieve the correct balance between open access with minimal duplication of administrative and other requirements on the one hand and investor protection on the other hand”.
Yes, Sir Humphrey, I would have been proud of that 20 years ago. The fact is, though, that the balance was not correct. The Government have since told us in their helpful reply to our report that the requirements for equivalence and reciprocal access have been eliminated in Council discussion, one of the reasons why I feel like congratulating them. However, I need to ask a question: is that still the case? Is there a stake through the heart of these third-country provisions? Has the Commission dropped its emphasis on equivalence? If not, and if the Commission is still going on about it, will the right-minded, such as the UK Government, hold firm in Council?
Secondly, as the noble Lord, Lord Harrison, said, what about the Parliament? Compared with my days in Brussels in the early 1990s, the Parliament has—rightly, in my view—much more power than it had then. Sadly, though, our Government have rather less influence than they had, which may be the inevitable consequence of the Conservative Party choosing to distance itself from the EPP in Brussels and Strasbourg, thus sharply reducing its chances of obtaining senior and influential positions in the Parliament, and of course removing a principal opportunity for influencing and alliance-building with like-minded Members of the Parliament. How confident are the Government that a good deal in Council—if it is a good deal, which I think it probably is—will not unravel in co-decision procedures with the Parliament? Are the Government acting on the first point that we made in our report when we said,
“we particularly urge the Government to ensure that they liaise with and pay due attention to the European Parliament in its consideration of the MiFID II proposals”?
Are we, in alliance with our friends in Council, lobbying hard in Strasbourg? Are Ministers going to Strasbourg specifically to talk about MiFID? Are all British MEPs, of whatever party, fully briefed on the importance of this directive for the City of London and the risks to us in the United Kingdom if it all goes wrong?
That is nearly all I want to say, but since the debate has ranged a little beyond MiFID, I will make one final point. As eurozone Ministers, along with those aspiring to join the eurozone, get together more and more closely—in the past fortnight they have been meeting a great deal—to discuss banking union, FTT, bail-outs and bail-ins for Cyprus, it becomes more important, as the noble Lord, Lord Harrison, pointed out, that we in the UK try even harder to stay alongside the debate or, ideally, at the heart of it, among the same people on the EU financial services legislation that is so important to this country. There will be caucusing among eurozone and eurozone-plus members. There is nothing we can do about it because it will happen informally. The Commission will try to prevent it. If in the end we wanted to go to the Court, we would obtain valueless rulings on our side. Caucusing is wrong but it will happen. And “les absents ont toujours tort”.
The best way of limiting the risk and mitigating the damage is to be as active as we can in making the European case for open markets. We should bring other countries’ Ministers, officials, European Parliament Members, journalists and opinion-formers to look at the City and understand the benefit that it represents for the EU as a whole—that of having a great global market on EU territory. This grows more important with every passing month and I hope that the Government, who I know do not agree with me on a number of things, agree with me on this and will try very hard.
I will say one last thing. Given the identity of the two speakers who are to follow me, I will quote from one of my heroes, Lord Thomson of Monifieth. George Thomson was one of our two initial commissioners. In 1999, talking about 1973 and the experience of going to Brussels with Christopher Soames, he wrote:
“I recall the remark of a wise Dutch Commissioner … ‘My dear George,’ he said, ‘there are now two countries in the Community who are stubborn about defending their national interests, France and Britain. But a word of advice … France always describes opposition to her position as a betrayal of Europe. Britain makes it appear as if Europe is betraying Britain. Not the best way to get results!’”.
It was not the best way then, and it is not the best way now.
Lord Liddle
My Lords, before I begin I should say that the think tank that I chair, Policy Network, has received funding from the City of London Corporation.
I will make three points in introducing what I have to say. First, I agree with the final point of the noble Lord, Lord Kerr, and with his tribute to my noble friend Lord Harrison and his fellow committee members—that should go on the record—for the excellent work that they do in bringing informed debate to the House.
Secondly, I will avoid the considerable temptation offered by the speech of the noble Lord, Lord Hamilton, to engage in the debate about the euro that he has so richly offered. I will just say—this is not meant to be a cruel point—that he has been making the same speech ever since I was privileged to join the House in 2010, and the euro has not collapsed yet. Even in what I agree was the mismanaged Cyprus crisis, the Cypriot Government decided that they would prefer to take the pain and stay in the euro rather than leave it.
Lord Hamilton of Epsom
Does the noble Lord accept that the pain has not even started in Cyprus yet?
Lord Liddle
They knew perfectly well what they were doing by signing up to the deal that they did. Perhaps I may make another aside. The idea that taxpayers should always pick up the bill for the irresponsibility of bankers is offensive. A lot of people in Cyprus have enjoyed the benefits of relatively high interest rates, which pensioners in Britain have not enjoyed over the past few years. The idea that they made these investments in a noble way that should be protected by the European taxpayer is, I think, offensive.
Thirdly, I agree with the noble Viscount, Lord Brookeborough, that the issues raised in this report are very complicated. I am certainly not in a position to talk about the details. Instead, I want to focus on the Government’s political strategy for handling these financial services questions. This is not a party point; it seems to me that as a nation we have a real difficulty here. A number of propositions form the approach on this side of the Room. The first is that we need a healthy financial services sector; I agree strongly with the noble Lord, Lord Hamilton, and the noble Viscount, Lord Brookeborough, on this. Yes, we need to rebalance our economy. My noble friend Lord Mandelson was right to say that we have had too much financial engineering and not enough real engineering, but the financial services sector is a huge overseas earner for us and we cannot do without it. It is a vital national interest where we have a comparative advantage. However, we have to acknowledge that things have gone wrong in the City in the recent past. Grave reputational damage has been done as the result of the LIBOR scandal and the scandals around mis-selling. Risks were taken that should never have been, and as a result we need to rethink the way we regulate the City.
The second proposition that should inform government policy on a national strategy in this area is that the City benefits hugely from being the financial centre of the European single market. The noble Lord, Lord Kerr, is right to say that what Britain achieved in the 1990s and the early 2000s—I was slightly involved in the 1999 Financial Services Action Plan—was tremendous. It opened up the market and ensured that London got a larger share of it. What happened, though, was that we had liberalisation without putting in place proper cross-country regulation, and we have to acknowledge that that was a UK mistake. It was a UK consensus that we should have light-touch regulation and we got it wrong. The Turner report that was published at the start of the financial crisis said that we have to choose between European regulation and being part of the European market or going back to national regulation, and that is basically right. I think that both the then Labour Government and the new Conservative/Lib Dem coalition have accepted that we are part of a properly regulated European single market in financial services.
However, the result of all this is that on the Continent there is now a great suspicion of UK motives in this field. I sense this an awful lot as I travel around to various meetings. Therefore, the third objective we have to set ourselves is to accept that we need re-regulation at the European level, but that it has to be done in a proportionate and sensible way. I have some sympathy with the remarks of the noble Lord, Lord Hamilton, about shutting the stable door and things moving on so that the new regulations will not cope with the new circumstances, but we must recognise that we have to put a national effort, as the noble Lord, Lord Kerr, said, into getting our regulatory strategy right.
We face big problems here. There are some basic asymmetries that put us in a difficult position. We had very strong support from what you might call the northern liberals for the positions that we took in the 1990s and 2000s but I am not sure to what extent that support is as solid as it once was, which I think is one of the reasons why the coalition on the financial transaction tax that the noble Lord, Lord Kerr, wants has not occurred. There is an asymmetry of expertise. People complain about the bureaucracy of the Commission, but when you look at the thousands of people employed in the regulatory agencies in London and the dozens who are dealing with these matters in the Commission—a very small group of people covering a very wide brief—it is not surprising that sometimes the proposals that come forward are flawed in key respects. The Commission tries to listen and amend in the light of representations made to it.
Another major asymmetry, which is a very serious one, is that there are euro-ins and euro-outs. We are among the euro-outs, and that is the way it is going to be, but we have to recognise, as a euro-out, that financial regulation is fundamental to the financial stability of the eurozone. If they are going to do whatever it takes to stabilise the euro then they will be prepared in the eurozone to adopt whatever financial regulations they believe are necessary to stabilise their currency.
In this situation, the national strategy clearly has to be to go out of our way to win friends and influence people. That is where the Government—or perhaps only one part of the coalition—has got it so badly wrong. There is a difficult environment for us in the European Parliament. They think bankers are to blame for the crisis and that Britain is, in part, to blame because we pushed a deregulatory agenda. How do we deal with that? Not by going in with the Thatcher handbag, nor by doing what David Cameron did at the December 2011 European Council in circulating a paper—which, incidentally, has never been disclosed to Parliament, although we have seen it and know what is in it—that had “unanimity” written at the top and which, to anyone who looked at it, would look as though the British Government were basically seeking to reverse qualified majority voting on a large number of financial services questions. It was a disastrous strategy: how could you expect the eurozone to agree to surrender sovereignty over their currency to Britain through our having a veto over financial regulation? We have to argue from a position of qualified majority, and we have to win friends and base our position on reason and good argument.
I agree with the noble Lord, Lord Kerr, that we have to point out to people the advantages of London being the global centre of the single market and all that that brings. At the same time, though, we have to acknowledge the criticisms of the City that have been made and demonstrate that we are prepared to see them tackled. That is basically the question that I put to the Minister: how are the Government going to do that? What is their political strategy for dealing with these questions, which are of vital national importance, even though they are of great complexity and difficulty for many members of the committee?
Lord Newby
My Lords, like other speakers, I congratulate the noble Lord, Lord Harrison, and his committee on producing such a comprehensive and thoughtful report on such a technical subject. I hope that noble Lords will forgive me if I start by dealing with some of the technical issues that the report covers before I get on to some of the broader issues that we have discussed.
As noble Lords have accepted, since it came into force in 2007, MiFID has had a major impact on how EU financial markets operate. This in turn has fed through to a significant impact on the wider economy. The directive has been instrumental in reducing barriers to trade in financial services and increasing competition in trading services. To build on these benefits, the Government agree with the committee that a review of MiFID I was necessary. The Commission’s proposals for a new directive and regulation broadly seek to address three areas where problems have arisen: negative side-effects resulting from the implementation of the original legislation; technological developments in how financial markets function; and issues exposed by the financial crisis.
There is much to welcome in the proposals. For instance, the creation of a new category of trading venue, called the organised trading facility, will capture virtually all organised multilateral trading. Another objective of the review—greater transparency in financial services—should help to protect investors and generally lead to greater efficiency in price formation. A policy of open access between trading venues and clearing houses will remove an important obstacle to competition, helping to create a more competitive single market in clearing and trading services. However, the policies contained in the MiFID review must be extremely carefully designed. The Government’s primary focus is ensuring that the measures contained in the review meet their objectives and do not damage competition or the efficiency of financial markets.
First, the Government share the committee’s concerns over the design of the organised trading facility. The Government continue to work hard in negotiations to try to ensure there is sufficient detail in primary legislation so that the proposals achieve their purpose.
Regarding the Commission’s proposal to extend the rules on market transparency to non-equity markets, the committee rightly notes that we must avoid a one-size-fits-all approach, as trading characteristics can differ significantly across asset classes. As the committee also observes, without proper understanding of these issues there could be an impact on liquidity and the cost of capital. The Government agree with both these points and continue to prioritise these issues in negotiations.
The proposals also increase transparency for so-called systematic internalisers. The Government believe that the systematic internaliser model has a role to play, but we acknowledge the committee’s comments that this category has not been heavily utilised and that some clarification of the purpose of the regime may be helpful.
As a consequence of recent technological advances in financial markets, the Commission has proposed new rules governing the operation of high-frequency trading. As the committee recommends, the Government’s position is that measures applied to algorithmic and high-frequency trading should be firmly grounded in evidence about its real impact. The Government note the welcome contribution that the Foresight report has made in this regard.
The Commission’s proposals also introduce an EU-wide third-country regime. This would harmonise the rules under which investment services can be provided by non-EU firms into the EU. Although we believe that there would be an economic rationale in extending the benefits of the single market to third-country firms, we fully agree with the committee’s comments on the global nature of financial markets. Our prime objective is to ensure that the UK, and indeed the entire EU, remains open to trade in financial services worldwide. The UK has worked hard in Council to amend the proposal and we believe that the current compromise will avoid the disadvantages and difficulties that the committee has identified.
While we support greater transparency in commodity markets, the Government agree with the committee that price volatility in these markets is dependent on a range of factors. In particular, in 2011, the G20 commodity study group was clear that fundamentals—in other words, supply and demand—have been driving commodity prices. The Commission’s proposed rules for commodity markets did not recognise this, placing undue emphasis on a particularly rigid regulatory regime. However, we are satisfied that the current compromise in Council provides for a suite of position management tools that will ensure that commodity derivatives markets are properly regulated throughout the EU.
Turning to the powers granted to ESMA under the MiFID review, the Government agree with the committee that ESMA has a strong coordinating role to play. However, it is important to ensure that powers assigned to EU agencies are in accordance with the treaties and relevant EU case law. The outcome of a legal challenge on certain powers conferred on ESMA in the regulation of short selling and certain aspects of credit default swaps will inform our long-term approach on this issue.
Finally, the Government believe that the Commission’s proposed measures to improve investor protection could be strengthened. However, there is considerable pressure from other member states to not implement an inducements ban at EU level. Therefore, the Government’s main objective in the remaining discussions is to ensure that the UK is still able to implement tougher measures domestically under the FSA’s retail distribution review.
The noble Viscount, Lord Brookeborough, talked about inducements. Our view is that the evidence suggests that inducements are being shown time and again to bias advice. Mis-selling, as we have seen many times in the UK, is an extremely serious issue and we must protect people against future scandals. It is relevant that research for the European Commission by Synovate suggests that as many as 57% of investment recommendations in Europe are unsuitable. We cannot ignore this very serious and ongoing issue.
I will say something about where we have got to in the negotiations. Our current expectation is that the Irish presidency will try to seek political agreement in May, although no firm schedule has yet been confirmed. There are still a few areas of outstanding disagreement. The main obstacles are the open access provisions, which Germany and a group of member states oppose, and the equity transparency regime, where France and some others want to see a uniform standard of transparency across all venues. On both these issues, the Government’s objective is to ensure that the regulatory framework does not impose unnecessary costs on the end users of financial services and supports growth in the real economy. We continue to work constructively on these high priority areas in Council, with the aim of reaching a compromise.
Questions were asked about the European Parliament and whether we are trying hard in both the Council and the Parliament. The Parliament compromise was agreed in September. As it stands, it is likely that the biggest difference between the Parliament and the Council will be the third-country regime. Although the Council has deleted much of the regime, Parliament has broadly opted to retain it, but with some positive amendments. However, in many other areas the Parliament and the Council texts are broadly aligned. We have been lobbying hard in Strasbourg and are working extremely hard in the Council to ensure that we get the best possible outcomes.
I turn to some of the broader comments which have been made. It is fair to say that they have occupied the bulk of this afternoon’s deliberations. There has been a lot of discussion about the financial transaction tax and where we are on it. The noble Lord, Lord Kerr, asked me six questions about that tax. As he knows, the proposals are relatively recent; some aspects of them are relatively unclear and the Treasury is, at the moment, analysing the proposals and seeking to understand them in greater detail.
Lord Kerr of Kinlochard
I have tremendous respect for the noble Lord, but that is the kind of answer we have been getting for a year on the financial transactions tax. The Council made a decision in January, with the UK—absurdly, in my view—abstaining. The point of principle is whether we agree that they may go ahead with levying a tax among 11 countries but requiring the rest of us, including the UK, to collect the tax for them and send it to them. Do we agree to damage our market? Do we agree that they have the right to do that? The key question is whether our interests are adversely affected. If so, they do not have the right to do it. Why did we abstain?
Lord Newby
We agree that they have the right to do it. The question which the noble Lord asked about whether this measure would damage the EU and the UK is not one to which there is a simple or straightforward answer. There are two completely different views about the impact of this tax on London. To a certain extent, we will not know, until it is implemented, which of these two views is correct. One view is that London will benefit significantly because we are out of it. If you look, for example, at what happened in Sweden, which had a transaction tax, the bond market collapsed totally and Sweden had to abolish it. If you take that view, a financial transaction tax is good for London.
Other people take a completely opposite view. The modalities of collecting the tax, and exactly how those will work, are clearly, from everything that the Commission has said, a work in progress. It is not, I believe, a unique suggestion within EU law and practice that member states will collect taxes that revert to other member states. I do not think it is a matter of principle; it will be a matter of practice and whether it is possible to put in place a practical solution.
Lord Kerr of Kinlochard
Surely, the complacent school of thought that says all the business will flow to the United Kingdom, others will damage themselves and we stand to gain, does not still exist in Whitehall. Surely, Whitehall has now persuaded itself that putting more grit in the cogs of the London financial markets is a bad thing, as is trying to persuade two American banks doing a transaction in London that, according to an instrument which originated in Germany, we should collect from both banks not for the British Exchequer but to send the money to the Germans. Surely, Whitehall has decided that that scenario is mad because the American banks will not trade in London if we apply this absurd regime. Surely, Whitehall is clear that we are approaching a crossroads and that we do not know which road to take. What are we going to do? Are we going to sit at the crossroads?
We have to decide what to do on the balance of the evidence. Surely, the balance of the evidence is overwhelming that this measure is a bad thing for the EU and a bad thing for the UK. Eleven countries do not agree, but I guess that 15 or 16 other countries do agree with us. Are we trying to construct an alliance with them or have we, as the noble Lord, Liddle, said, such a pariah status that we cannot construct an alliance? I do not believe that. I still think that this situation could be remedied. Are we going to go to law? We need legal advice on who is right. I believe that if we could be damaged by this measure, and the chances are that we will be, it is not permitted under the treaty. Therefore, I do not understand why we abstained and I do not understand why the Prime Minister was silent.
Lord Newby
My Lords, if I did not know the noble Lord better, that speech would seem to me to typify the attitude that gets us into difficulty. He asserts with absolute certainty that the French do not know what is best for them, the Germans do not know what is best for them and the other nine who have signed up to this tax do not know what is best for them as he believes that it will be very damaging.
Lord Kerr of Kinlochard
I am sure that none of my friends or none of the noble Lord’s friends would do this but it is just possible that some people in France would like to damage the London market.
Lord Newby
I am sure that some people in any country will want to do virtually anything, but the question I was addressing was whether the 11 countries that have signed up to this tax can be dismissed as not knowing what is best for them, even though we are deeply sceptical about it and are not going to sign up to it. We have had a number of debates in your Lordships’ House about Greece, for example, in which some noble Lords seem to have known what is best for Greece. It is just that the Greeks have not agreed. We have to let other member states move forward with this within the rules because they are keen to do so.
Lord Hamilton of Epsom
Does my noble friend accept that at one stage the Germans were very much against this proposal and then they changed their mind? Was it that they did not know what was best for them originally and then they did know subsequently, or did they get it the other way round?
Lord Newby
I think that my noble friend should ask them because I have not the faintest clue what was in their mind, but they have now formed a view. If the German Government have a settled view, even if I do not agree with it, I would not write it off as a mad one. I am sure that we will come back to the financial transaction tax, but it is not unreasonable to say that an extremely complicated tax using very difficult mechanisms to make it work should necessarily be capable of instant analysis in terms of how we are going to deal with it. We are looking at it. We have had the proposal for only a few weeks, and my right honourable friend Greg Clark, as the noble Lord, Lord Harrison, pointed out, is actually one of the better Ministers in any Government in terms of working with Parliament and, indeed, across the EU. I am sure that in due course he will come back with a full description of our response.
Lord Kerr of Kinlochard
I am testing the Minister’s patience, but we are now past the point where we can affect it. The only question remaining for us is whether we can overturn it. After the January ECOFIN it is now up to those who participated in it to devise the tax as they think is best for them. We cannot affect that, but we will be obliged to collect it. I am not clear what we are working hard on at the moment. What are we trying to do? We are not in the room any more. I would say that we ought to try to derail this exercise by going to law. We need to mount a legal challenge. We must create a political alliance and mount a legal challenge.
Lord Newby
My Lords, I am conscious of the time. Much as I would like to go on until eight o’clock on this subject, I think that we are going to have to return to it.
I shall turn to some of the other points that have been made in the debate. I would say to the noble Viscount, Lord Brookeborough, that one person’s harmonisation is another person’s single market rules. Sometimes harmonisation works very much to the benefit of the UK and sometimes it does not. We have to take this on a case-by-case basis, but let us remember that by common consent the single market has been very beneficial to the UK. If we can, we want to strengthen it even if, as inevitably will be the case, some of that strengthening includes common rules.
Viscount Brookeborough
I did not say that harmonisation was not a good thing, rather I looked at the way this tax is being brought forward. They were talking about harmonisation before they started raising the money. They did not like to talk about why they were raising the money and doing it only over a certain number of countries.
Lord Newby
I am grateful to the noble Viscount for that clarification. The noble Lord, Lord Kerr, asked about the benefit of the EU to the City as a whole, and both whether the Government recognise that and whether are doing anything to promote it. There is no doubt in my mind, having watched the Government in action, that they absolutely understand the role of the City and how having a strong financial services sector is immensely valuable to the UK and to the EU. The Government themselves are working very hard, as noble Lords have said, on this directive and others to make sure that we end up with proposals which are compatible with the ongoing success of the City.
One of the frustrations I felt before I was a Minister and which, to a lesser extent, I still feel, is that the City is not always its own best advocate. Although things have improved considerably with the formation of TheCityUK, and there is now a much wider recognition that the financial services sector needs to get its act together, as it were, to promote itself, there is still some way to go. Although the UK Government are active in the Council and in the European Parliament, they need the UK financial services sector to be independently active in those institutions as well. There was a period when a lot of senior people in the City felt so battered with the experience that they had following 2008 that they were not willing to put their heads above the parapet and make the arguments. I think that that phase is over, to a certain extent at least, and the Government are encouraging them very much to do that. I am very grateful to the noble Lord, Lord Kerr, for quoting Lord Thomson of Monifieth. He, of course, was from that great tradition of canny Scots who could fully understand the benefits of engaging with the EU.
I will make just two points before I finish in response to the noble Lord, Lord Liddle. First, he talked about asymmetries. There are a number of asymmetries. Looking at the future of this directive, we are talking about the possibility of making considerable progress while Ireland still has the presidency. However, the amount of financial services expertise which Lithuania is going to bring to the party in the second half of the year is relatively limited. It is a terrible burden on the officials and Ministers from small member states who have to grapple with what, by common consent and as anybody who has read the report knows, is an immensely technical subject. Virtually the only people other than members of your Lordships’ committee who understand it are the people who work in it every day. The truth is that there are not many of them in small member states, which is an asymmetry. Clearly, there is also an asymmetry between the Commission and the UK. There is one asymmetry that we can benefit from by using our expertise. I was extremely interested that, despite the fact that we are not in the euro, a group of Treasury officials went to Cyprus at the weekend in order to help sort out that problem. It will be very interesting when they get back to see what they have learnt from it.
The final point is about how we exercise influence in an environment where we are not part of the euro-in group. In my view, the model—which I have seen in operation—is that adopted by my colleague in another place, Ed Davey, when he was in BIS, who established something called the “like-minded growth group” for promoting the single market. At every point, Mr Davey carried in his pocket a little laminated piece of paper which showed the voting strength of every member of the 27, and he was forever working out how you got that qualified majority or majority. He worked very hard, and succeeded, at getting a majority of member states, both euro-ins and euro-outs, to co-operate to promote the single market. That is a model that I think is still pursued within BIS. We have got to, as the noble Lord, Lord Kerr, said, be very active working out where we can form alliances, which we can do on many things. One of the ironies about the current financial circumstances is that we, as a euro-out, have much more in common with some of the northern European countries that are trying to impose fiscal discipline. For good or ill, we are now something of an expert on that in this country and we need to make the most of it. There are no permanent alliances; you have to rebuild and refresh them. One of the challenges for the Government—or any Government—is to do that as best they may.
Finally, reverting to the splendid report that we have been discussing this afternoon, the Government welcome it and agree with all the points it raises. We accept, as I have attempted to explain, that the devil is in the detail. The Government will continue to negotiate carefully so that MiFID II does, indeed, get it right for the City and, most importantly, for the users of financial services.
Lord Harrison
My Lords, I am minded to say that never in the field of markets and financial instruments has there been so interesting, so sexy and so stimulating a debate as has taken place here this evening. I thank all who have participated in it, especially the two Front-Benchers, but also my colleagues such as the noble Viscount, Lord Brookeborough, and the noble Lord, Lord Kerr. I would particularly like to thank our officers, Rose Crabtree and Stuart Stonor, for the work that they do for us behind the scenes, which is very considerable.
I was going to end on a humorous note, saying that I wake up every morning and thank the Lord that the noble Lord, Lord Hamilton, is not like other men. That has been well demonstrated. In fact, he reminds me of the story that William Hazlitt tells in one of his essays about going for a walk with Coleridge. He says that he set off with Coleridge down a Somerset lane. He, Hazlitt, would walk in a straight line; Coleridge was forever diverting, off up on the left, off up on the right, forward and backward and then eventually coming back to join his friend Hazlitt. This debate has been a little bit like that. I began to puzzle why it strayed off the beaten path of MiFID in the way that it has. I think that it was for an important point, and I know that the Minister does not have the opportunity to come back.
I hope that the Minister takes away the intensity of feeling that those of us who were posted away to Committee Room 3 to look at some of these difficult and brain-tingling matters are getting with a greater and greater sense of urgency. This country is not recognising some of the real confrontation that is being borne in upon us by having adopted what I understand to be a negligible position—that of the head in the sand— where we say that these things can be decided by others, but we must progress and let them progress in the way they so wish, and it will not have an effect on us.
I will finish on this one point about Mr Bergmann, who was referred to several times this evening. It was quite clear to us that the defence that the Commission mounts—that this is wholly legitimate under subsidiarity and in other ways because it does not infringe the single market—is simply wrong. It does infringe the single market, and it infringes not the gang of 11 who are going forward, but the gang of 16, who are not participating. If we as the UK are not alert to that and if we are not very careful, we will lose our goose that lays a golden egg. In losing that golden egg of the City of London, we will lose it not just for the United Kingdom: we will also lose it for the European Union. That is why we must take such care. We are in conversation with the FST, Greg Clark, and I was in conversation with David Lidington this afternoon. I hope that the noble Lord, Lord Newby, will take it upon himself, with his deep knowledge of the City of London that he has demonstrated so often, to express the urgency and concern that has caused this debate on the narrow subject of MiFID to spill over into the other dossiers that are before us which cool and chill our hearts.
House of Lords
Introduction: Baroness Lane-Fox of Soho
Syria: Refugees
(11 years, 8 months ago)
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Lord Selkirk of Douglas
To ask Her Majesty’s Government whether they will make representations to the European Union and the Government of the United States about the long-term humanitarian implications of the increasing number of refugees escaping from Syria into neighbouring countries.
Baroness Northover
My Lords, this month marks the second anniversary of the crisis in Syria. Recognising the significant challenges that this protracted humanitarian crisis presents, the UK remains in contact with the United States, the European Union and other international partners regarding how best to support Syrian refugees in the short and longer term.
Lord Selkirk of Douglas
Does my noble friend accept that while Britain, the United States and Germany have given generously to aid agencies to help alleviate the plight of more than 1 million Syrian refugees who have fled to neighbouring nations, according to the United Nations a very large part of the more than $1 billion pledged by 32 countries has not yet been delivered? Does she agree that it is time for those who have promised funding to act and that, as the Secretary of State for International Development has so wisely said, warm words are not enough?
Baroness Northover
My noble friend is right. States made very generous pledges in Kuwait earlier this year to the UN appeals for Syria and the region. However, not all pledges have yet been translated into actual contributions. Given the scale of the challenge— 4 million people are in need, of whom 2 million have been forced to leave their homes—that is extremely worrying. We call on donors to expedite the transfer of funds without delay and are actively encouraging that.
Lord Wright of Richmond
My Lords, does the Minister accept that providing lethal weapons, as the Government appear to want, to the deeply divided Syrian opposition can only exacerbate the civil war in Syria and lead to a further deterioration of the appalling humanitarian crisis which is affecting both Syria and her neighbours?
Baroness Northover
The noble Lord speaks with great wisdom. He will know that there are already huge dangers of instability in the region and that any action, or inaction, can promote further instability. We have no current plans to send arms to any groups in Syria, but, as again he will know well, others are arming groups in Syria. As the noble Lord will also know, nothing is off the table, but we are doing our very best to try to bring about a diplomatic resolution to that, which I am sure everybody would welcome. In the mean time, DfID’s key aim is to assist in relieving the humanitarian disaster that has come into existence there.
Lord Collins of Highbury
My Lords, not only is the issue one of current spending but the situation is deteriorating speedily. Funding so far has been allocated up to 30 June. Obviously aid agencies need to plan for the future as well. It is important that the Government not only deal with current need but look at future need. Another issue is that the clear majority of refugees in Jordan are women, children and the elderly. In representations to the European Union and the United States, will the Minister highlight the plight of female refugees and the support they will be given to cover basic living costs?
Baroness Northover
The noble Lord is right on both counts. The $1.5 billion that was pledged in Kuwait will last only until June and only about 20% of that so far has been forthcoming. There is a major challenge there. We welcome the Disasters Emergency Committee appeal that was launched in the United Kingdom on 20 March. The United Kingdom is third at the moment in its contribution in this regard and we are keenly aware of the situation with women and girls. We are supporting them in particular in the countries around Syria. We are well aware that they are very vulnerable in this situation and have targeted support at them.
The Lord Bishop of Exeter
My Lords, on a previous occasion I asked the Government for an assurance that our humanitarian response to the situation on Syria’s borders would ensure that adequate provision was still given to the survivors of sexual and gender-based violence. In being given that assurance, I was also assured that more would be done to document these abuses so that the perpetrators might be brought to justice in due course. Can the Minister say what is being done to carry that commitment forward?
Baroness Northover
The right reverend Prelate is right. My right honourable friend the Foreign Secretary has promoted the Preventing Sexual Violence in Conflict initiative, which supports women particularly in Syria but also in Jordan. Local health professionals are being trained in how to respond to reports of sexual violence with the objective of improving the prospect for future investigation and potential prosecution, which the right reverend Prelate rightly identifies as very important.
Lord Alderdice
My Lords, on previous occasions I have sought assurances from Her Majesty’s Government that we would concentrate our attention on humanitarian aid, particularly to Turkey and Jordan, which have huge burdens of Syrian refugees, and also to Lebanon and Iraq. Given the recent remarks of our Prime Minister and President Hollande of France, can I press my noble friend to assure us that whatever others do we will not be engaged in military support, other than giving proper support to our front-line ally Turkey, but that we will concentrate on humanitarian aid?
Baroness Northover
Following on from the question asked by the noble Lord, Lord Wright, I reiterate to my noble friend the risks of action and inaction. We take very seriously the points that he makes. I would point out that the United Kingdom has already pledged almost £140 million in humanitarian relief. It has committed £22 million in terms of non-lethal equipment and practical support for the Syrian opposition and civil society. That is separate from our humanitarian support, but the noble Lord will note the difference in the sizes of those figures.
Lord Eden of Winton
My Lords, should we not be looking to some of the oil-rich nations, such as Saudi Arabia, to do much more to help in this tragic situation?
Baroness Northover
At the conference in Kuwait, a number of the Gulf States made very generous pledges. For example, the UAE pledged $300 million, as did Kuwait, and Saudi Arabia $78 million. We are concerned that they now deliver on those pledges. We were encouraged that they made them and now hope to see them implemented.
Armed Forces: Autonomous Weapon Systems
(11 years, 8 months ago)
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Lord Harris of Haringey
To ask Her Majesty’s Government what is their policy on the deployment of autonomous weapon systems by United Kingdom Armed Forces.
Lord Harris of Haringey
My Lords, I declare an interest as an adviser to Lockheed Martin, although not on its defence business. I beg leave to ask the Question standing in my name on the Order Paper.
The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Astor of Hever)
My Lords, the United Kingdom does not have fully autonomous weapon systems. Such systems are not yet in existence and are not likely to be for many years, if at all. There are currently a limited number of naval defensive systems that could operate in automatic mode, although there would always be naval personnel involved in setting the parameters of any such operation. I must emphasise that any type of weapon system would be used only in strict adherence with international humanitarian law.
Lord Harris of Haringey
My Lords, I am grateful to the Minister for that reply. Is it the view of Her Majesty’s Government that there is a world of difference between a drone operated remotely from several hundred or thousands of miles away and one that is automatic and involves no human intervention before it discharges? In that context, will he tell us a bit more about the Mantis development by BAE Systems, which I understand is supported and funded by the UK’s Ministry of Defence, which the BAE Systems website describes as,
“Able to fly by itself, able to think for itself”?
Lord Astor of Hever
My Lords, I agree with the noble Lord. As I said in the original Answer, the UK complies fully with its obligations under national and international law, and that applies to autonomous weapon systems. However, although technological advances are likely to increase the level of automation in some systems, just as in non-military equipment, such as cars, the MoD currently has no intention of developing systems that operate without human intervention.
As for Mantis, the MoD initiated a jointly funded advanced concept technology demonstrator in 2008, which led to flight trials in 2009. The MoD has no current involvement in BAE Systems’ Mantis advanced concept technology demonstrator.
Lord Lee of Trafford
Does my noble friend agree with the comments of a senior RAF officer who said very recently that come 2020 the Royal Air Force would be something like 50% manned aircraft and 50% VAV or drones?
Lord Astor of Hever
My Lords, remotely piloted aircraft systems are likely to form part of the future force mix, as they may offer advantages in endurance and range. However, the dynamic complexity of fighter-versus-fighter-type missions does not favour remote control. Therefore, a wholly unmanned force is unlikely to be achievable or desirable in future. Studies suggest a likely combat air force mix of two-thirds manned and one-third remotely piloted in around the 2030 timeframe.
Lord Rosser
There is a perception that unmanned technology is shrouded in secrecy. Although the rules of engagement for unmanned aerial vehicles are the same as those for manned aircraft, there is surely a case for the United Kingdom taking the lead by considering having a code on the context and limitations of usage of UAVs to clarify the rules, given the significance and spread of this technology. Is this a point that the Government are considering or will consider?
Lord Astor of Hever
My Lords, I shall certainly take that question back to my department and get back to the noble Lord. We always make sure that equipment is used appropriately. Even after a weapon system is declared lawful, its use will still be subject to stringent rules of engagement governing its employment in the context and specific circumstances of the operation in question. Those rules of engagement as well as addressing legal issues can, as a matter of policy, be more restrictive than the applicable law.
Lord Hylton
Are unmanned aircraft and weapon systems included in the arms trade treaty now under negotiation? Is there not a great danger of proliferation?
Lord Astor of Hever
My Lords, I cannot answer the first part of the noble Lord’s question, but I will write to him about that. As I said in my original Answer, these issues are very carefully considered, and what the noble Lord suggested is unlikely to happen.
Lord West of Spithead
My Lords, the Minister slightly confused me with one of his answers. Will he confirm that for anti-missile, close range anti-aircraft, and anti-torpedo reaction systems, there is considerable merit in going for an autonomous system, even if it has a manual override? From what he said it sounds as though we are not continuing to develop that capability. Is that correct?
Lord Astor of Hever
My Lords, in essence, an automatic system reacts to a limited number of external stimuli in the same way each time, just as automatic transmission changes gears when a car gets to a certain speed. Fully autonomous systems rely on a certain level of artificial intelligence for making high-level decisions from a very complex environmental input, the result of which might not be fully predictable at a very detailed level. However, let us be absolutely clear that the operation of weapons systems will always—always—be under human control.
Lord Tanlaw
Can the Minister say whether these machines contradict the first law of robotics in the sense that they identify and kill human beings? They are open to malfunctions, like any other machine, so is there not a great danger of this occurring at some future time?
Lord Astor of Hever
My Lords, as I said in my response to the noble Lord, Lord Harris, the United Kingdom complies fully with its obligations under both national and international law.
Lord Hughes of Woodside
My Lords, in responding to my noble friend and to other noble Lords who have raised this Question, because it is so important will the Minister place copies of his answers in the Library?
Scotland: Referendum
(11 years, 8 months ago)
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Lord Foulkes of Cumnock
To ask Her Majesty’s Government what discussions they have had with the Scottish Government regarding the arrangements for the referendum on independence.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
The United Kingdom Government had a number of discussions during 2012 regarding the arrangements for the referendum on independence. These discussions led to the details set out in the referendum agreement on 15 October. As with the agreement, we continue to work constructively with the Scottish Government to ensure that there is a legal, fair and decisive referendum on Thursday 18 September 2014.
Lord Foulkes of Cumnock
I am grateful to the Minister for that reply. Have the Minister and his colleagues had time to consider the request from the First Minister of Scotland for the Prime Minister to appear in face-to-face debates on television in the run-up to the referendum? Will he confirm that this request will be completely rejected and that the United Kingdom Government will make it clear that if anyone from the UK Government takes part it should be the Secretary of State for Scotland, his deputy or the Advocate-General?
Lord Wallace of Tankerness
My Lords, I have indeed heard the First Minister’s call for a head-to-head debate with the Prime Minister. I also recall the First Minister warning London-based politicians such as the Prime Minister to keep out of the referendum campaign, so he cannot have it both ways. While I accept the challenge and would be delighted to take part, one might also ask whether the First Minister will go head-to-head with the leader of the Better Together campaign, Mr Alistair Darling, who at least has a vote in the referendum, unlike the Prime Minister. However, let me make this clear: the Prime Minister will argue very vigorously for Scotland’s continuing place in the United Kingdom.
Lord Forsyth of Drumlean
My Lords, will my noble and learned friend acknowledge that the Prime Minister is not a London-based politician? He is Prime Minister of the whole of the United Kingdom. Will he not agree that the referendum on independence for Scotland is clearly a matter for Scotland? However, if we were to move to devo-max or some form of federalism, that would be a matter for the whole of the United Kingdom, which would need to be settled by a referendum that involved everyone in the United Kingdom.
Lord Wallace of Tankerness
I certainly agree with my noble friend, and I think I made it clear that the Prime Minister believes in the integrity of the United Kingdom. I believe it was others who suggested that he was a London-based politician. I also hear what he says about so-called devo-max, which is a brand without a product at the moment. I also recognise that that has implications for the other parts of the United Kingdom and that, were we to go down such a road, it would be very important to secure buy-in from those other parts of the United Kingdom.
Lord Wigley
My Lords, will the Minister please confirm that the conduct of the referendum in Scotland is now entirely a matter for the Scottish Parliament, and one for which this place has no responsibility?
Lord Wallace of Tankerness
My Lords, as noble Lords will recall, we agreed to a Section 30 order under the Scotland Act in January of this year, which transferred powers to the Scottish Parliament to determine the nature of the referendum. A Bill has been brought in for a referendum; indeed, another Bill has been brought in to determine the franchise for that referendum.
Lord Martin of Springburn
My Lords, it is not the first time that ballot papers have not been made available in good time for those entitled to a postal vote. Could the Minister, when he next meets the First Minister, ensure that the printer gets the ballot papers to the returning officers so that those who are entitled to postal votes get them?
Lord Wallace of Tankerness
The noble Lord makes an important point. That would be overseen by the Electoral Commission and the Electoral Management Board for Scotland. Unlike elections, where candidates are often not nominated until the last minute, we now know what the question is, so there is no reason why these ballot papers should not be prepared well ahead of time.
Lord Maclennan of Rogart
Will my noble and learned friend indicate how the Scotland analysis programme is progressing, particularly with respect to monetary arrangements and the employment of citizens from either country, to enable the facts to be assimilated by the whole country and to inform the pre-referendum debate?
Lord Wallace of Tankerness
My Lords, the Government have made it clear that they wish the referendum debate to be well informed. That is why we have embarked on the Scotland analysis programme. The first paper on the legal implications and the legal basis of independence was published last month. There will be future papers, including one on currency and financial regulation, which we hope will be published in the near future. It is important that we have a well informed debate, and certainly the United Kingdom Government, through these papers, are determined that we should have just that.
Lord McAvoy
My Lords, the SNP Government have claimed that there will be an increase in oil tax revenues post-independence. However, today we hear from the Centre for Public Policy for Regions that, contrary to what the Scottish SNP Government claim,
“to suggest some sort of new oil-tax revenue boom is about to emerge is not readily supported by the evidence”.
Does the Minister agree that the Scottish SNP Government need to be straight with the people of Scotland about the facts of the decision that they have been asked to make in 2014, so that we can get on with making the case for why Scotland is “better together”?
Lord Wallace of Tankerness
My Lords, I entirely endorse what the noble Lord has said about the importance of getting clear facts. He is right. I have seen the report published today by the Centre for Public Policy for Regions, which makes the point about the uncertainty of the oil revenue. That uncertainty was underlined by the Office for Budget Responsibility in its report last week. We hear representatives of the Scottish Government telling us that we are on the cusp of another oil boom, but in the Cabinet paper that the Finance Secretary presented to the Scottish Government last year, he said that there is a,
“high degree of uncertainty around future North Sea revenues, reflecting considerable volatility in production and oil prices”.
It would be useful if they said in public what they say in private.
The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford)
My Lords, it is this side.
Baroness Knight of Collingtree
On the question of eligibility to vote, can my noble and learned friend the Minister inform this House whether the millions of Scottish-born and Scottish people who presently live in England will be permitted to vote?
Lord Wallace of Tankerness
My Lords, as I indicated, the franchise is being determined by the Scottish Parliament. However, there was agreement that it should be based on the local government franchise, which means that it would include those registered for local elections in Scotland. Therefore, it would exclude people of Scottish origin living in other parts of the United Kingdom. The Scottish Government’s legislation would also seek to extend it to 16 and 17 year-olds residing in Scotland.
Baroness Liddell of Coatdyke
My Lords, is the Minister aware that the date of the referendum coincides with the centenary of the Battle of Loos, where many brave Scottish soldiers gave their lives—my great-uncle, Matthew Lawrie, included—for every part of the United Kingdom? What reassurance can the noble and learned Lord give this House that Scottish men and women currently serving in the British Armed Forces will have the ability to vote in the referendum?
Lord Wallace of Tankerness
My Lords, that is an important issue, which we considered and reflected on during our debates on the Section 30 order. There are a number of ways in which service personnel can register to vote; many Scottish servicemen and servicewomen who are posted outside Scotland will remain entitled to be registered at an address in Scotland, either because they are resident there or because they have a service declaration for such an address. I understand that the Ministry of Defence does an annual advertisement of the service declaration, but I can assure your Lordships’ House that we will encourage the ministry to redouble its efforts in that advertisement in the run-up to, and for registration for, the referendum.
NHS: Out of Hours Service
(11 years, 8 months ago)
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Lord Kennedy of Southwark
To ask Her Majesty’s Government what steps they are taking to ensure high-quality out of hours GP medical care is in place.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, people are entitled to expect high-quality health services at any time of day or night. All out-of-hours services must be delivered according to national quality requirements, and local providers have a legal requirement to make sure that high-quality out-of-hours care is in place. If this is not happening, we expect action to be taken immediately to improve services.
Lord Kennedy of Southwark
The publication of the Patients Association survey and the comments from the BMA highlight that many GP practices are struggling to cope with a rising workload as resources are falling. Does the Minister agree that, with many other changes taking place across government on 1 April, we are in a dangerous and worrying period for people who find themselves in need of health and related services?
Earl Howe
My Lords, of course, the results from the Patients Association report are a matter for concern. We are absolutely committed to improving access to GPs and, from 1 April, responsibility for making sure that that happens will pass to the NHS Commissioning Board. We have outlined a clear set of objectives around patients’ experience of local primary care services in the mandate to the board; we have launched marketing campaigns in each of the new NHS 111 areas, which we are confident will facilitate better access to out-of-hours care; and we will publish information regularly, so that patients can see how their practice is performing and feed back to their practice when it is not performing.
Lord Ribeiro
My Lords, at a time when nurses are being urged to wash their patients, is it not time that the GP contract was renegotiated so that GPs can be responsible for the out-of-hours care of their patients and, in doing so, perhaps relieve the pressure on our A&E departments?
Earl Howe
Increasingly, this is likely to happen, because our changes to the GP contract this year are bound to make sure that GPs think more about long-term integrated care for their patients. The recommendations from NICE underpinned the new arrangements in the GP contract, and my noble friend is absolutely right that that has to remain very squarely in the sights of all GPs.
Lord Hunt of Kings Heath
My Lords, I refer noble Lords to my health interests in the register. The Minister mentioned the NHS 111 service. Is he aware of reports up and down the country of a shortage of staff and long waiting times to get through to the service? Is he also aware that the system is increasing pressure to close walk-in centres? Combined with a poor-quality out-of-hours service, is it any wonder that acute hospitals are under such pressure? Will the Government look at this again?
Earl Howe
I am aware of teething problems in two particular areas of the country, but we know from the pilots of NHS 111 that there is a high rate of patient satisfaction with the service. As noble Lords will know, NHS 111 is designed to put the caller through to the right service first time around, whether it is a nurse, a doctor or an ambulance, if that is required. There are bound to be teething problems, and rolling out a service like this across the country is, of course, a major task. But the concept of increased flexible access to healthcare and advice is absolutely right, and we are determined to see the service work very well for everybody.
Baroness Emerton
My Lords, in his Answer to the original Question, the Minister said that action would be taken if the service failed. Who will actually take the action under the new system once the Act becomes actionable next weekend?
Baroness Jolly
My Lords, in some parts of the country confidence has been lost in out-of-hours services. The NHS Commissioning Board takes over next week, so what can it do in terms of commissioning smartly to regain the public’s confidence in these services?
Earl Howe
We have known that out-of-hours care has been in need of reform for some considerable time. The much strengthened commissioning arrangements that we have put in place, including the national quality requirements that I mentioned earlier, will enable that to happen.
Baroness Wall of New Barnet
The noble Earl will, I am sure, recall the discussion we had just a few days ago about the inspection of patients at home. That discussion was about ensuring that patients at home who were poorly in the evening did not end up in hospital. My noble friend has just indicated the tremendous pressure that all hospitals are under in terms of length of stay because of older people arriving and staying in hospital. If this GP out-of-hours service worked well, we would prevent that. We need to ensure that the accuracy and rigour of that service permeate throughout the whole country.
Rights of the Sovereign and the Duchy of Cornwall Bill [HL]
Mid Staffordshire Foundation Trust Inquiry
(11 years, 8 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, I shall now repeat a Statement made earlier today in another place by my right honourable friend the Secretary of State for Health on the Government’s response to the Francis report. The Statement is as follows:
“With permission, Mr Speaker, I would like to make a Statement on the Government’s response to the Mid Staffordshire NHS Foundation Trust Public Inquiry. I congratulate my right honourable friend and predecessor on setting up the public inquiry, and on the many changes that he made foreseeing its likely recommendations. I would also like to pay tribute to Robert Francis QC for his work in producing a seminal report which I believe will mark a turning point in the history of the NHS.
Many terrible things happened at Mid Staffs in what has rightly been described as the NHS’s darkest hour. Both the current and former Prime Minister have apologised, but when people have suffered on this scale, and died unnecessarily, our greatest responsibility lies not in our words but in our actions—actions that must ensure the NHS is what every health professional and patient wants: a service that is true to the NHS values, that puts patients first and treats people with dignity, respect and compassion.
The Government accept the essence of the inquiry’s recommendations and we shall respond to them in full in due course. However, given the urgency of the need for change, I am today announcing the key elements of our response so that we can proceed to implementation as quickly as possible. I have divided our response into five areas: preventing problems arising by putting the needs of patients first; detecting problems early; taking action promptly; ensuring robust accountability; and leadership. Let me take each in turn.
To prevent problems arising in the first place, we need to embed a culture of zero harm and compassionate care throughout our NHS, a culture in which the needs of patients are central, whatever the pressures of a busy, modern health service. As Robert Francis said, ‘The system as a whole failed in its most essential duty: to protect patients from unacceptable risks of harm and from unacceptable, and in some cases inhumane, treatment that should never be tolerated in any hospital’.
At the heart of this problem, the current definitions of success for hospitals fail to prioritise the needs of patients. Too often, the focus has been on compliance with regulation rather than on what those regulations aim to achieve. Furthermore, the way that hospitals are inspected is fundamentally flawed, with the same generalist inspectors looking at slimming clinics, care homes and major teaching hospitals—sometimes in the same month. So we will set up a new regulatory model under a strong, independent chief inspector of hospitals, working for the CQC. Inspections will move to a new specialist model based on rigorous and challenging peer review. Assessments will include judgments about hospitals’ overall performance, including whether patients are listened to and treated with dignity and respect, the safety of services, responsiveness, clinical standards and governance.
The Nuffield Trust has reported on the feasibility of assessments and Ofsted-style ratings, and I am very grateful for its thorough work. I agree with its conclusion that there is a serious gap in the provision of clear, comprehensive and trusted information on the quality of care. So in order to expose failure, recognise excellence and incentivise improvement, the chief inspector will produce a single aggregated rating for every NHS trust. Because the patient experience will be central to the inspection, it will not be possible for hospitals to get a good inspection result without the highest standards of patient care.
However, the Nuffield rightly says that in organisations as large and complex as hospitals, a single rating on its own would be misleading, so the chief inspector will also assess hospital performance at speciality or department level. This will mean that cancer patients will be told of the quality of cancer services, and prospective mothers the quality of maternity services. We will also introduce a chief inspector of social care and look into the merits of a chief inspector of primary care in order to ensure that the same rigour is applied across the health and care system.
We must also build a culture of zero harm throughout the NHS. This does not mean that there will never be mistakes, just as a safety-first culture in the airline industry does not mean that there are no plane crashes, but it does mean an attitude to harm which treats it as totally unacceptable and takes enormous trouble to learn from mistakes. We await the report on how to achieve this in the NHS from Professor Don Berwick.
Zero harm means listening to and acting on complaints, so I will ask the chief inspector to assess hospital complaints procedures, drawing on the work being done by the Member for Cynon Valley and Professor Tricia Hart to look at best practice.
Given that one of the central complaints of nurses is that they are required to do too much paperwork and thus spend less time with patients, I have asked the NHS Confederation to review how we can reduce the bureaucratic burden on front-line staff and NHS providers by a third. I will also be requiring the new Health and Social Care Information Centre to use its statutory powers to eliminate duplication and reduce bureaucratic burdens.
Secondly, we must have a clear picture of what is happening within the NHS and social care system so that, where problems exist, they are detected more quickly. As Francis recognised, the disjointed system of regulation and inspection smothered the NHS, collecting too much information but producing too little intelligence. We will therefore introduce a new statutory duty of candour for providers to ensure that honesty and transparency are the norm in every organisation, and the new chief inspector of hospitals will be the nation’s whistleblower in chief.
To ensure that there is no conflict in that role, the CQC will no longer be responsible for putting right any problems identified in hospitals. Its enforcement powers will be delegated to Monitor and the NHS Trust Development Authority, which it will be able to ask to act when necessary.
We know that publishing survival results improves standards, as has been shown in heart surgery. So, I am very pleased that we will be doing the same for a further 10 disciplines: cardiology, vascular, upper gastro-intestinal, colorectal, orthopaedic, bariatric, urological, head and neck, thyroid and endocrine surgery.
The third part of our response is to ensure that any concerns are followed by swift action. The problem with Mid Staffs was not that the problems were unknown; it was that nothing was done. The Francis report sets out a timeline of around 50 warning signs between 2001 and 2009. Ministers and managers in the wider system failed to act on these warnings. Some were not aware of them; others dodged responsibility. This must change. No hospital will be rated as good or outstanding if fundamental standards are breached. Trusts will be given a strictly limited period of time to rectify any such breaches. If they fail to do this, they will be put into a failure regime which could ultimately lead to special administration and the automatic suspension of the board.
The fourth part of our response concerns accountability for wrongdoers. It is important to say that what went wrong at Mid Staffs was not typical of our NHS and that the vast majority of doctors and nurses give excellent care day in, day out. We must make sure that the system does not crush the innate sense of decency and compassion that drives people to give their lives to the NHS. Francis said that primary responsibility for what went wrong at Mid Staffs lies with the board. So, we will look at new legal sanctions at a corporate level for organisations that wilfully generate misleading information or withhold information that they are required to provide. We will also consult on a barring scheme to prevent managers found guilty of gross misconduct finding a job in another part of the system. In addition, we intend to change the practices around severance payments, which have caused great public disquiet. In addition, the General Medical Council, the Nursing and Midwifery Council and the other professional regulators have been asked to tighten their procedures for breaches of professional standards. I will wait to hear how they intend to do this, and for Don Berwick’s conclusions on zero harm before deciding whether it is necessary to take further action. The chief inspector will also ensure that hospitals are meeting their existing legal obligations to ensure that unsuitable healthcare support workers are barred.
The final part of our response will be to ensure that NHS staff are properly led and motivated. As Francis said:
“All who work in the system, regardless of their qualifications or role, must recognise that they are part of a very large team who all have but one objective, the proper care and treatment of their patients”.
Today I am announcing some important changes in training for nurses. I want NHS-funded student nurses to spend up to a year working on the front line as support workers or healthcare assistants, as a prerequisite for receiving funding for their degree. This will ensure that people who become nurses have the right values and understand their role. Healthcare support workers and adult social care workers will now have a code of conduct and minimum training standards, both of which are being published today. I will also ask the chief inspector to ensure that hospitals are properly recruiting, training and supporting healthcare assistants, drawing on the recommendations being produced by Camilla Cavendish. The Department of Health will learn from the criticisms of its own role by becoming the first department where every civil servant will have real and extensive experience of the front line.
The events at Stafford Hospital were a betrayal of the worst kind—a betrayal of the patients, the families, and of the vast majority of NHS staff who do everything in their power to give their patients the high-quality, compassionate care that they deserve. However, I want Mid Staffs to be not a byword for failure but a catalyst for change: to create an NHS where everyone can be confident of safe, high quality, compassionate care; where best practice becomes common practice; and where the way in which a person is made to feel as a human being is every bit as important as the treatment they receive. That must be our mission and I commend this Statement to the House”.
My Lords, that concludes the Statement.
Lord Hunt of Kings Heath
My Lords, I am sure that the House will wish to thank the noble Earl for repeating the Statement.
The NHS is now 65 years old and if it is to be ready for the challenges of the future it has to learn from what happened at Mid Staffordshire. The NHS was founded on compassion; Mid Staffordshire was a betrayal of all it stands for and, rightly, apologies have been made. Now, however, it is time to act and to make this a moment of change. Robert Francis delivered 290 careful recommendations after a three-year public inquiry. The Prime Minister promised a detailed response to each by the end of this month. Although we welcome much of what the noble Earl has said today, it falls short of that promised full response. I ask him to be a little more precise about when we can expect the full response to be made.
There are serious omissions from the Statement on four flagship recommendations and I would like to press the noble Earl on those today. First, I should like to deal with the proposed duty of candour. We from the Opposition welcome the move to place a duty of candour responsibility on healthcare providers and believe that it could help bring the culture change that the NHS needs. However, the noble Earl will know that the Francis report goes further in recommending a duty of candour on individual members of staff. Will the Secretary of State say more about why he has only accepted this recommendation in part and not applied it to staff? Has the noble Earl ruled this out, or is he prepared to give further consideration to it?
On providers, will the noble Earl assure the House that that duty will apply equally to all providers of NHS services, including private providers? The Statement was rather vague on that point. The logic of a fair playing field, which I think has been the subject of a report published today, must suggest that anyone providing services to the NHS must come within the same regulation. I refer the noble Earl to the experience in Cornwall where there is a private sector provider and a weak primary care trust which the National Audit Office has commented on. Would that provider come within the terms of what the noble Earl has said?
I was interested in the Statement referring to new legal sanctions in general at a corporate level for organisations that wilfully generate misleading information or withhold information they are required to provide. Can the noble Earl confirm that that sanction will apply to Ministers, the Department of Health, the NHS Commissioning Board, Monitor, the CQC and all the other public regulators and those who have authority over the NHS? It would be grossly unfair if this was simply to apply to parts of the National Health Service and not to those organisations that have so much power over the NHS. I would be grateful for a response on that.
I turn to the other issue in relation to private providers. Is it not the case that we will not get full transparency unless provisions of freedom of information apply to all holders of NHS contracts and the information cannot be withheld under commercial confidentiality? I remind the noble Earl of the regulations in relation to Section 75, which are absolutely apposite to this question of a level playing field.
I turn to the question of a patient voice. The Government have announced new chief inspectors of hospitals and social care, which was not a Francis recommendation. Is there not a risk of top-down regulatory structures reinforcing the wrong culture, looking up to Whitehall and not out to patients and the community? Surely the noble Earl will accept that regulation alone will definitely not prevent another Mid Staffs. What might prevent it is a powerful patient voice in every community that is able to sound the alarm if things go wrong. In that context, I have a question about local Healthwatch? We know that one-third of local authorities have said that their local Healthwatch will not be up and running by 1 April. We also know that there are wide variations in structure and membership. I wonder whether the noble Earl will accept Robert Francis’s recommendation of a consistent basic structure for Healthwatch throughout the country, before it is too late and before they go their separate ways. The importance of the proposal is that these bodies can give a very powerful voice to patient concerns about the quality of care in their locality.
My third area of concern is regulation and training. Mr Francis has made a very clear case for a new system of regulation of healthcare assistants to improve basic standards. The noble Earl does not need reminding that many noble Lords are concerned on this point. Unfortunately, I did not hear in his reading of the Statement any reference to the statutory regulation of healthcare assistants, and it is disappointing that the terms of reference for the Cavendish review do not include consideration of that matter. Have the Government now rejected that recommendation; are they still considering the regulation of healthcare assistants; or have they decided after all to support the principle?
We support the move to rebalance nurse training to include more hands-on experience. Does the noble Earl accept that hospitals need to be given much more authority in the training of nurses and the balance between what happens in hospitals and what actually happens within universities? Does he acknowledge that student nurses already spend 50% of their time in clinical practice and also face significant financial barriers when completing training? In the light of the announcement, can he assure the House that the requirement for a year on the ward will not increase the financial barriers to young people entering nursing? If more trainees are to be on the ward, will he ensure that there are enough staff with the time to train the extra students? In that light, will the Government encourage the appointment of supervisory ward sisters to allow more time for leadership, training and support of those student nurses? I should have declared an interest in making this response to the Statement. The noble Earl will be interested that my own trust, Heart of England, has announced this week a £1.4 million investment in the introduction of supervisory ward sisters to do just that. Will he encourage other hospitals to do likewise?
I listened with care to the Statement when it referred to the creation of a culture of zero harm throughout the NHS. Such an objective must be right. We know from previous statements that the Secretary of State is keen to follow the example of the airline industry and note that Professor Don Berwick will report to the Secretary of State on those matters. However, does the noble Earl not think it rather ironic that the Government abolished the National Patient Safety Agency, which was set up to mirror what has happened in the airline industry and encourage staff to raise concerns about patient experiences? Does he not see that although the national reporting and learning system has been retained, placing it under the control of the NHS Commissioning Board is completely at variance with the philosophy in the airline industry of giving people absolute safety in reporting incidents to the system? Will the noble Earl reconsider this matter?
I have real concerns about the decision that the CQC will no longer be responsible for putting right any problems with quality identified in hospitals. I do not think that that is the right decision. How on earth can the decision be taken to give Monitor and the NHS Trust Development Authority—which, as far as I know, has no clinical expertise whatever—the power to deal with issues which the CQC has raised? Other than the thought that they are relying on health and competition economists—which Monitor is stuffed full of—to do this, does it mean that Monitor will now have to employ lots of clinicians on its staff? Can the noble Earl explain why this rather puzzling decision has been made?
The fourth major issue concerns staffing, which is the most glaring omission from the Statement. The culture will never be right on our wards if they are understaffed and overstretched. The CQC has recently reported that one in 10 hospitals does not have adequate staffing levels. Indeed, last week, workforce figures showed that there had been a reduction of 843 nurses between November and December. Does this not sound the clearest of alarm bells that some parts of the NHS are in danger of forgetting the lessons of its recent past by cutting the front line? Do we not need objective benchmarks so that staffing levels can be challenged on wards?
Last week, we learnt that the Department of Health has handed £2.2 billion from last year’s NHS budget back to the Treasury. Would not that money be better used to bring nursing staffing levels up to standard? I wonder whether the noble Earl and his ministerial colleagues are in denial about the pressures on the health service at the moment. The system is under horrendous pressure. Primary care is faltering. We heard earlier about the appalling standards in many out-of-hours services at the moment. The 111 service is problematic in some parts of the country. There have been huge cuts in local government adult social care spending. Yet the system—Monitor and the NHS Commissioning Board—carry on oblivious to this, obsessed by their target culture. I ask the noble Earl whether Ministers really understand what is happening, and whether they are now prepared to look again at the way the system will be managed in the future.
Finally, I return to Mid Staffordshire hospital itself. Monitor has recommended that this hospital is placed in administration. We should not forget that the future of the hospital will cause real concern to the people of Stafford. After all they have been through, surely we can all agree that they deserve a safe and sustainable hospital. I hope that the noble Earl will soon be able to set out a plan to achieve it.
Earl Howe
My Lords, I am grateful to the noble Lord, Lord Hunt, for his comments, and for the support that he was able to give to a number of the proposals that the Government have made. I will attempt to answer as many of his questions as possible. First, he asked why the Government’s response does not address all 290 of Francis’s recommendations. This report, which comes seven weeks on, is not and I think could not be a full response to each and every one of those recommendations. Francis himself notes in his report that:
“Some recommendations are of necessity high level and will require considerable further detailed work to enable them to be implemented”.
That work we will most certainly do. We accept most of the recommendations in Robert Francis’s report, either in principle or in their entirety, but I emphasise that there is much more to do. To rush ahead would mean that we would not give the full and collective consideration to the report that is clearly needed. It would also limit the clinical engagement and the patient and public involvement that is so important. Our response today is designed to be an overarching one, setting out our key early priorities.
The noble Lord asked me about the duty of candour. We recognise that attaching criminal sanctions to key areas of public service delivery can send an important message to the public about the expected standards of care and duty. That is why we will consider the introduction of additional legal sanctions at a corporate level where organisations wilfully generate misleading information, or withhold information that they are required to provide. I cannot be more specific about the extent and scope of that, but we do think there is an issue to be addressed there. I will take the noble Lord’s points on board as to how widely that should go.
However, we are concerned that the introduction of criminal sanctions on individual staff who provide NHS services could run counter to the creation of an open and transparent culture. It could instead create a culture of fear that could lead to the cover-up of mistakes, which is the very opposite of what we seek to achieve. That of course could in turn prevent lessons being learnt and could make services less safe. However, we agree that where staff are obstructively dishonest action will need to be taken to ensure that the quality of patient care is not jeopardised. We are asking the NMC and the GMC to look at how they might be able to strengthen professional standards and disciplinary measures to address those kinds of case. Registered clinical staff are, of course, already placed under a duty to be open through their professional regulators, but we will consider whether is a need to add to that duty in the light of the Berwick review on safety.
Turning to healthcare support workers, as I have frequently said in your Lordships’ House, the Government’s mind is not closed to statutory regulation, but regulation as such is no substitute for a culture of compassion and effective supervision. Putting people on a national register does not guarantee protection for patients, as was sadly seen at Mid Staffs. Instead, we have decided to tackle this issue at its root, focusing on making sure that healthcare support workers have the right training and values and, most importantly, support and leadership to provide high-quality care.
As I repeated in the Statement, we are today publishing minimum training standards and a code of conduct for healthcare and care assistants. In addition, all healthcare support workers work under registered professionals who are responsible for the care provided to their patients. Camilla Cavendish has been asked to conduct an independent study of healthcare and care assistants to ensure that they have not just the right training but the right support to provide services to the highest of standards. She is due to report in May. We will consider further action following that review. Health Education England is working with employers to improve the capability and training standards of the care assistant workforce. Its strategy will feed into the Camilla Cavendish review.
As regards nurse training and the idea that every prospective nurse should have bedside experience before undertaking formal training, we believe that that idea should be piloted. The charge that we have heard for so many years that some nurses are too posh to wash must be got rid of. We must ensure that we are training nurses who have an aptitude for the role and who know what it is like to have hands-on experience as a healthcare assistant before committing themselves to training. Starting with pilots, every student seeking NHS funding for nursing degrees should, we believe, first serve for up to a year as a healthcare assistant to promote front-line caring experience and values, as well as academic strength. The current first-year dropout rate for nurses alone is 25%. For that reason also, it is important to ensure that we have the right sort of man and woman as a nurse trainee. We recognise that the scheme will need to be tested and implemented carefully to ensure that it is cost-neutral. Of course that is a consideration and the noble Lord was right to raise it. We will explore whether there is merit in extending the principle to other NHS trainees.
The noble Lord asked me a number of questions about the chief inspector. We think that having a chief inspector as part of the senior team of the CQC will provide us all with an expert judgment on the part of those who have walked the wards, spoken to patients and staff, looked the board of directors in the eye and made a rounded judgment of an organisation’s health, and thereby give true quality assurance, as opposed to what I fear that we have seen all too frequently, which is a tick-box approach. It will be a powerful role and it is very important that the data on which the chief inspector relies are representative of quality. That is a job of work that needs to be done.
The noble Lord also asked me about the National Patient Safety Agency. We continue to believe that it is absolutely right to place the national reporting and learning service within the Commissioning Board if we are to learn from safety incidents and near misses and to enable that information to be fed directly into commissioning behaviour. It is obviously important that we do not lose the expertise that the NPSA has built up. I hope and believe that we will not and that this is the right model. Nevertheless, the noble Lord is right to flag up that we need to learn from experience and we will do that.
As regards the CQC’s responsibilities, the noble Lord may be aware that the Health Select Committee of another place recently reported on the role of Monitor. One of the key criticisms that it levelled against the current system was that it is, in many senses, ambiguous. Sometime the roles of Monitor and the CQC appear to overlap and sometimes there appears to be a gap as to exactly who is responsible for what. Having thought very carefully about this issue, our judgment is that it is important to be crystal clear about who is responsible for what. The CQC’s powers, in terms of warning notices and improvement notices, will remain, but should the CQC find that there is an intractable case of quality failure in a provider organisation, it should not be the CQC’s job to sort that out. There should be a single failure regime triggered by Monitor, which is the body currently responsible for triggering the financial failure regime. The details are yet to be worked out, but clarity of roles is vital in this area.
I am aware that there are one or two questions that I have not covered, but I undertake to write to the noble Lord on those.
Baroness Jolly
My Lords, I thank my noble friend the Minister for repeating the Statement. I am sure that many noble Lords will welcome, in due course, a full and spirited debate on this issue. Will my noble friend clarify which of the recommendations that are being adopted will require primary legislation, what the timescale might be and what the mechanism might be for that?
We welcome my noble friend’s remarks on the duty of candour but, as with all these things, the devil is in the detail. My question is about the chief inspector regime in general. We are going to have a chief inspector of hospitals so it would seem sensible to have a chief inspector of social care. Will we then need a chief inspector for public health and another one for mental health? Is that the way to have all the bases covered?
Earl Howe
My Lords, it is a little early to say what legislation we will need, but I can tell my noble friend that we can deal with the duty of candour by secondary legislation. It may be that many of the follow-up actions to Francis can be done without any legislation at all. However, primary legislation would appear to be the obvious route when statutory roles are to be changed.
With regard to the chief inspectors, the only firm decisions we have taken so far are to appoint a chief inspector of hospitals and a chief inspector of social care. We are looking at the merits of a chief inspector of primary care but we need to make sure that there is a genuine issue that needs to be addressed by way of a chief inspector role rather than leaving the CQC to perform its role in the normal way. Further details will be forthcoming at an appropriate time.
Baroness Emerton
My Lords, I would like to mention nurse education. The suggestion of having some front-line experience before entering university is, philosophically and practically, very good if it can be worked, but it raises all sorts of questions. I spoke to a healthcare support worker a few weeks ago who said that all the students who come on to her ward tell her, “I wish we had had this experience that you are getting before going into training”, so there is evidence that many of them would like to have that kind of experience. However, this raises the question of their supervision during that time. Will there be adequate numbers of trained staff to supervise the continuing support workers as well as those who are pre-nursing apprentices, or whatever?
The logistics of this are going to be important to work on. We need to know whether the Government will look at minimum staffing levels. Where there are enough registered nurses and the minimum is stated, there should be means whereby registered nurses will be available whenever demands on patient care escalate, such as during a time of winter problems, rather than abusing and misusing the support workers. There is a tremendous amount of work to be done on that.
There is also the role of the Nursing and Midwifery Council, which has responsibility for regulating the pre-nursing standards. I hope the Government will ensure that the council takes an active part in this pre-nursing experience, because that will be important. I urge Ministers to have this minimum staffing looked at, if that is possible. I am extremely disappointed that the Government are not prepared to take on the regulation of these support workers because I fear that we may find ourselves having similar problems as in the past, unless we have some regulatory system.
Baroness Northover
My Lords, I remind noble Lords that brief questions only are called for after Statements, and that the briefer they are, the more colleagues will be able to get in.
Earl Howe
I reassure the noble Baroness that all the concerns that she rightly raised are very much in our sights, not least the need for proper supervision of nurse trainees and the practical aspects of having the right level of support on the ward. This is why we believe that this idea should be piloted first, so that lessons can be learnt. Yes, we will involve the NMC, and indeed the Royal College of Nursing, in these plans. As regards ratios, having the right staffing in terms of numbers and skills is clearly vital for good care, but minimum staffing numbers and ratios, if laid down in a rigid way, risk leading to a lack of flexibility or organisations seeking to achieve staffing levels only at the minimum level. Neither of those is good for patients. However, I do not dismiss the general concept. It is ultimately up to local organisations to have the freedom to decide the skill mix of their workforce, based on the health needs of those on the wards.
Baroness Pitkeathley
My Lords, the principle of putting the needs of patients first will be welcomed by every Member of this House. However, does the Minister agree that this means looking at care in an integrated way, since the patient experience is very rarely one of either hospital or social care but a mixture—sometimes a very haphazard mixture—of the two? Can the Minister therefore give the House more detail about how the government proposals will facilitate the integration of care services across health and social care, particularly as there will be two separate inspectors and as the ability of the CQC to put the shortcomings right is apparently going to be passed to Monitor?
Earl Howe
My Lords, the main drivers and levers for increased integration will come from other directions, such as: the systems we are putting in place at local authority level and health and well-being board level; more sophisticated tariffs; better commissioning arrangements between the NHS and social care; and the financial imperative that all commissioners and providers now face. That will mean an imperative to ensure that resources are not wasted and are deployed to the best effect of patients.
We must also remember that the NHS outcomes framework will be the benchmark by which the success of the service is judged, just as the social care outcomes framework will act in that sphere in an equivalent way. The major domain in both areas is the patient experience. If we believe that integration is above all to be defined by reference to the patient’s experience, we can expect commissioners across the piece to address commissioning in a way that avoids disjointed care.
Lord Cormack
My Lords, is my noble friend aware that many people in Staffordshire will welcome this report but will wonder whether the present chief executive is the best person to oversee the implementation of the many recommendations to which my noble friend has referred?
Earl Howe
My Lords, it was a signal feature of the Francis report that he consciously avoided pointing the finger at individuals. The chief executive of the NHS did not have the finger of blame pointed at him. The House may be interested to know that I regard Sir David Nicholson as a truly outstanding public servant who has done an enormous amount of good for the NHS since becoming chief executive.
The benefit of hindsight is wonderful but we must remember that in the years in which these dreadful events took place the National Health Service was held to account by reference to two main indicators: access to care and waiting times, and finance. Above all, it was the arrival of the noble Lord, Lord Darzi, as a Minister and the Secretaries of State whom he served that saw the transformation of the NHS from an organisation that was concerned just about numbers into one that really appreciated that quality matters. Therefore, to accuse those with positions of responsibility with regard to Mid Staffs of overlooking the fact that quality was poor is to place a wholly unfair retrospective expectation on them.
Lord Patel
My Lords, a great deal of importance and emphasis is being placed on introducing zero harm with regard to patient safety. I am delighted that the Government have asked Don Berwick to advise them how to do this. Do the Government intend to have zero harm in the NHS as a concept or as a requirement? If it is the latter, what legal framework will make that happen?
Earl Howe
It is much more a question of culture than anything else. However, the noble Lord will be aware that Robert Francis recommended that we look at the concept of fundamental standards below which care should never fall. We are determined to do that. Defining a fundamental standard is something for wide discussion. However, we take this recommendation very seriously. Robert Francis was clear that if individuals or an organisation were found guilty of breaching fundamental standards, serious consequences should ensue.
On a more general level, it is impossible to expect human beings never to make a mistake or never to fall down on the job. The point here is to create an attitude of mind in all those who work for and with the NHS that puts the patient’s well-being at the centre of their daily lives and thinking. That is where we want to be.
Lord Bilston
The recent pronouncements of Monitor seem to ignore the vast majority of the people of Stafford, who, as my noble friend Lord Hunt indicated, require a range of safe, sustainable and comprehensive health services rather than the delegation of a range of services, including elective surgery, to other hospitals such as New Cross in Wolverhampton. That hospital is already under considerable pressure and has inadequate facilities in many areas, including a very restricted site with inadequate car parking. Will my noble friend comment on that, because there is great concern and anxiety in Wolverhampton that many thousands of people will be allocated to New Cross and that it will be unable to respond that heavy need? As always in these cases, the balloon will burst and we will quickly find that New Cross Hospital itself sinks into the abyss and then has difficulty responding to the health needs of the people of Wolverhampton.
Earl Howe
I understand the noble Lord’s concerns and those of the people of Stafford. Unfortunately, this trust is losing a substantial amount of money. That is not a situation that anybody can be relaxed about, which is why Monitor has taken the action that it has. One of the tests by which any trust administrator’s report will be judged will be whether the solution offered delivers high-quality care and the prospect of good health outcomes to the patients of the area. This is not just a pounds, shillings and pence exercise; it is an exercise that is necessarily looking at services across the piece to see how they can be better and more cost-effectively configured to ensure that high-quality care is maintained.
Baroness Browning
My noble friend will be aware that the Mental Capacity Act was not mentioned or used at Winterbourne View and that we have seen one too many reports from Mencap about the deaths on hospital wards of young people who have a learning disability or autism. In the next 12 months, this House will carry out post-legislative scrutiny of the Mental Capacity Act. Will my noble friend ensure that his department is not just a passive observer of that process but communicates with those on that committee to ensure that people on hospital wards who lack capacity, albeit a fluctuating or temporary lack of capacity, are not only spoken to but treated like any other patient?
Earl Howe
My noble friend is right to raise this issue, and I pay tribute to the work that she has so consistently done to improve the lot of those with autism. I undertake to write to her about this, but I can give her the general reassurance that the Department of Health will certainly be involved in the scrutiny of these measures, as will the NHS Commissioning Board. I want to ensure that we learn the right lessons from the actions already taken.
Baroness Masham of Ilton
My Lords, does the Minister not think that, with the duty of candour, those who make mistakes should take responsibility and be accountable for them? Otherwise people will not learn from those mistakes and they will continue. I also want to ask about the 10 disciplines. I was very surprised that respiratory conditions are not included as nearly all death certificates have pneumonia on them.
Earl Howe
I undertake to look at the latter point made by the noble Baroness. The 10 disciplines were selected as ones that could reasonably and readily be subject to the kind of assessment process that we are looking to achieve. I will come back to her on that.
As regards the duty of candour, individuals should certainly take responsibility for their actions and be encouraged to do so. We fear, however, that criminalising individuals’ behaviour within an NHS organisation could risk doing the opposite of what we all want to see: a much more open culture, one that has made the NPSA and its work so successful; a no-blame culture, where people take responsibility for when things go wrong but do not feel that the heavy hand of authority is going to descend upon them at the merest mistake. However, it is important that people are held to account if they are dishonest or deliberately withhold information, and that is a different set of issues.
Lord Walton of Detchant
The appalling failings highlighted in the Francis report clearly demonstrated that the managerial virus—an obsession with meeting targets—infected many of the medical and nursing staff in Mid Staffs and diverted them from their primary standards of providing a high quality of patient care. Many of the proposals set out in the Statement are essentially welcome.
I learnt only last week of the new assessment method, PLACE, and I would love to hear where that fits in to the programme. Having said that, will the Government take note of the fact that there is a danger in creating a superfluity of regulatory authorities that would divert doctors and nurses from their primary bedside responsibilities? Is it not better to make certain that regulatory authorities function much more efficiently and effectively in controlling standards?
Earl Howe
I wholeheartedly agree with the noble Lord. One of the concerns at the back of our minds as we have considered Robert Francis’s report is the need to ensure that we do not create oppressive additional regulation to cure the problems that Francis has identified. Indeed, we need to look at doing the opposite: how can we lift regulatory burdens and ensure that the culture Francis spoke about can thrive? The NHS Confederation is advising us on this. It is looking specifically at burdens placed on NHS providers and organisations, and we shall take its recommendations to heart.
Growth and Infrastructure Bill
17:24 - Division on Amendment 1 - Ayes: 217 / Noes: 211 - Amendment 1 agreed.
Baroness Anelay of St Johns
My Lords, this is another occasion on which it is my duty with regard to some Bills to signify the Queen’s consent in the normal manner.
I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Growth and Infrastructure Bill, has consented to place her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Amendment 1
“Development orders: development within the curtilage of a dwelling house
(1) Section 61 of the Town and Country Planning Act 1990 (development orders: supplementary provisions) is amended as follows.
(2) After subsection (3) insert—
“(4) Any development order or amendment to an existing development order made after 1 January 2013 that grants planning permission for development within the curtilage of a dwelling house shall not apply within the jurisdiction of a local planning authority if that authority has resolved that it shall not.””
Lord True
My Lords, I declare an interest as leader of a suburban local authority that is also a planning authority. I thank the leaders of many other local authorities, along with the Local Government Association, who have given this amendment strong support.
This is Third Reading, so I will not go over all the arguments heard before on this issue, but I hope the House will allow me some indulgence, as this is the first time after nearly 40 years of service to my party and 20 years as an elected representative that I find myself contemplating dividing against my party. Your Lordships’ debate on Report in which Peers from all sides spoke was a devastating rejection of the Government’s wish to impose this idea, and I agreed with all that was said.
I had great sympathy for my noble friend Lady Hanham that day. I respect her hugely, as she knows, for the way she has handled this Bill. We all know that she did not cook up this idea. Indeed, I am pretty sure that if, when she was leader of Kensington and Chelsea, some bright young councillor had come to her and said, “Hey Joan, I’ve got a great modernising idea. Why don’t we take away the rights of neighbours to object to big extensions?”, that clever young man would have been sent away with a flea in his ear by his leader, yet that is the extraordinary proposition that I draw to your Lordships’ attention today.
Before the dust had settled on our debates on localism and the NPPF with the sensible liberalisation of planning therein, out popped a big new idea to sweep aside the newly entrenched localism and use Whitehall diktat to double the amount of back gardens that could be built over without planning permission and take away the rights of immediate neighbours to have a say or to object. That was not in any manifesto or in the coalition agreement. All those documents pledged to protect back gardens, and I, and perhaps others in this Chamber, looked people in the eye in 2010 and made that pledge on doorsteps. For my part, as an elected representative, I propose to stand by it.
My amendment is modest. It is a compromise. I think the Government are wrong to want to take away a neighbour’s right to comment on an extension that could be 50%, or technically in some cases a little more of a small neighbouring garden in a terrace. Back gardens are an important reinforcement of mutual value and of the character of an area. My amendment does not block the Government’s wish to do that. I say to my noble friends on coalition Benches that no one who votes for my amendment today, if I press it, will be preventing the Government from making such an order, nor would they be stopping anyone applying for an extension. It merely moderates a one-size-fits-all approach and allows local decision: localism. It states that if a local authority thinks that extending permitted development in gardens to this extent is not appropriate for its area, it may opt out. What is it about this small thing on which this great Government will not compromise? Do they not understand how people live cheek by jowl in the suburbs? I am beginning to wonder whether someone who had an extension refused got stroppy with some Minister or a top civil servant over dinner.
I did not press a similar amendment on Report for two reasons. The first was because I still hoped that the Government might listen, but late yesterday I received a letter from my noble friend making clear that they would not. Secondly, our debate on Report left open a number of questions about what in the jargon is called an Article 4 direction. My noble friend very kindly provided material on this in her letter. Having read it, I remain unconvinced that it provides a sensible answer to an unnecessary question.
I also remain puzzled by the logic of the Government’s position. My noble friend implies in her letter that Article 4 directions are quite easy and normal and can readily be used if councils do not want to extend permitted development. That might be read to imply, although crucially she does not say so and did not say so when asked directly on Report, that all such local directions to opt out would be supported by the Government. Then her bosses handed a file to my noble friend marked “resist” on an amendment that allows a faster, simpler route to the same opt-out point as Article 4 would offer. It simply does not add up. I fear that the truth is that someone deep in Whitehall, while singing the song of localism, wants to keep a hold over local authorities to modify or cancel an Article 4 direction at any time, in which case on this matter Article 4 would be mere fool’s gold.
I do not wish to detain noble Lords with detailed debate on Article 4, because the small print is a diversion from the main principles of localism and householder rights that are engaged here. I must point out that my noble friend’s letter did not mention the complication arising from rights to compensation that may come with Article 4 directions when planning approval is approved. Leeds City Council alone has calculated that its potential exposure in relation to one aspect of policy is between £1.5 million and £3 million. Nor did it mention the lost planning fees—perhaps £250,000 a year in my authority alone, according to my officers—and there will be no less work to be done, for you can be sure that time saved on planning control will be time increased on building control, as neighbours who have not had opportunities to comment on proposed extensions will ask the building inspectors to look at whether the work is being done properly. Of course, even on my noble friend’s best-case presentation of Article 4 directions, it is a process that takes many months.
When the Government commend Article 4 against the faster, simpler approach to local choice that I and my noble friends propose in this amendment, it is as though a man had stopped his car and asked for directions to a town. Instead of saying “Oh, it’s just there, over that hill—it’s about half a mile away”, a bystander deliberately points him around 10 miles of byways, consuming quantities of petrol on the way, with a possibly impassable ford lurking on the route. It seems wasteful and pointless. Every argument the Government make that Article 4 is a good way to opt out is an argument for the simpler, faster route proposed in this amendment.
I return to the fundamental arguments. The Government have suggested a world where in close suburban neighbourhoods people can put up a six or eight-metre back garden extension, and people living in the house to which they may be attached have no right to a say in this or to object. It is not hard to imagine the shock and dismay that some people will feel if they ever find out that it is happening to them. They will feel powerless and angry.
This proposal is not about growth; it is ludicrous to argue that a few back garden extensions would kick-start the economy. It is not about localism and community; it denies localism and avowedly reduces community rights—Ministers say that it does. It is not about new housing; not a single new upstairs bedroom will be built in Britain as a result of this proposal. It is not about making it easier for people to improve their homes; they have every right to do so now and still would if my amendment were passed. It is not even about property rights, for it transfers power and rights from those who lose most directly from any development and adds to the gain of the richer and more assertive, who would gain anyway.
This proposal takes away a neighbour’s right to have a say on a big and potentially overbearing extension shoved up outside their back door. What is more, it removes that vital process of moderation and conciliation that the local planning system provides in these matters. How often do those who have been upset by a planning proposal next door go away finally satisfied if a small condition is added, a modification made, or just by the simple expedient of being able to have their say before the local planning committee? Paradoxically, at this micro-level, a planning hearing can be an enabling process that allows arbitration and reconciliation, without which, in those small, precious, suburban communities, neighbour would be set against neighbour in perhaps lasting resentment.
For those who have worked hard and striven to buy and maintain a home, it is the most precious possession they have. Restricting their right to have a say in what so directly affects it will strike at their most basic instincts of what ought to be secure and what they see as fair. Good policy should surely have a sense of how things work at the human scale, and it is at that level that this proposal so conspicuously fails. To me, there is a principle of equity here, and it is on just such matters that your Lordships’ House has always been a voice of wisdom and held out a hand of protection for the rights of a citizen to come before a tribunal, as a planning committee is, and be heard. I ask your Lordships, in so close an interest for every homeowner, to consider that civilising and reconciling right.
Lord Tope
My Lords, I have added my name to this amendment proposed by the noble Lord, Lord True, feeling as strongly as he does and with as much sadness as he has expressed. Like him, I am a councillor in an outer London, suburban authority. Indeed, I am a former leader of that council. Like him, I have campaigned and been elected many times on the commitment to preserve back gardens, which is a crucial issue in most suburban authorities and no doubt elsewhere.
The noble Lord, Lord True, spoke very eloquently and very fully on the issues here. I shall try not to take so much time or to repeat too much of what he has said. He referred to the origins of this proposal last summer. It seemed a good idea when government circles were scratching around trying to find anything that would stimulate growth and this proverbial young Kensington councillor to whom he referred came up with this jolly wheeze. Frankly, it would have been much better had they listened at that time to the strong and unanimous reaction right across all parties, across local government and, indeed, across the country pointing out what a silly idea it was. Sadly, that did not happen. People somewhere in government dug in on it. As the noble Lord, Lord True, said, we went to a hastily contrived consultation lasting six weeks, ending on Christmas Eve. At Report, the Minister told us that there had been 1,000 responses. It has been 13 weeks since that six-week consultation ended. We have no idea today, and I suspect that we will have no better idea by the end of today, what those 1,000 replies said. Surely somebody somewhere could simply have divided them into for, against and not quite sure. We could at least get some indication of what that response is, unless we have no indication. If we get no indication in the reply to this debate, we are forced to conclude that a very substantial number of those 1,000 replies have been put in the against pile. For what other reason have we had no indication in the 13 weeks since the consultation closed?
I share the affection of the noble Lord, Lord True, for the Minister. We were London borough council leaders together for many years, and I know very well what her views are, even if she is not allowed to tell us from her present position. At Report, she said that the proposals were to,
“extend the localism rights”.—[Official Report, 12/3/13; col. 197.]
The only rights that are being extended here are to home owners—the right to do as they wish. It may well have sounded good when it was first suggested, but the rights being taken away are the rights of the neighbours to those home owners to have their say on those proposals—and usually there are rather more neighbours than there are home owners. So, in fact, more people are losing rights in this alleged extension to localism than are gaining them.
Among the rights being taken away is the right to have a say. The Minister expressed a hope, which we would all have, that neighbours would talk to each other. Of course that happens, and we would all want it to happen. Quite often, those discussions take place and can be resolved in an amicable way between neighbours; that is what we would all desire. But we all know that, outside that ideal world, it does not always happen that way. The rights being taken away are the rights of the neighbours to be able to appeal for arbitration from a local planning authority, and to ask the house owner who wishes to extend the property properly to take into consideration the interests, wishes and concerns of their neighbours. If they know that they do not have to apply for planning consent, there is no incentive to do so other than to wish to be a good neighbour. If they think that their neighbour is reasonably or unreasonably going to object to their plans for the extension, it is unlikely that they will voluntarily submit to such consultation.
The Local Government Association and the Minister have commented, I am sure correctly, that 90% of such planning applications are currently approved. That is a very good record, which suggests that there is not too much wrong with the present system. But why is there such a high approval rate? It is simply because of the need to have planning consent, and the opportunity that is given to neighbours to have their say and for the applicant to know that the neighbours will have their say, as well as for the role of the local planning authority not just to be able to arbitrate but to be able to mitigate, negotiate and, one hopes, to resolve any outstanding concerns.
This proposal comes as part of a Growth and Infrastructure Bill, and is supposed to incentivise growth—and I think that, to be fair, everyone would agree that it does so in a relatively small way. Presumably, it would do so not for the major developers of the land but for the small builders. I have the good fortune quite often to talk to or, more usually, to be talked at, by quite a number of small builders in my role as a councillor. When I ask them—although I do not usually need to ask them—what they wish the Government would do to make their business more successful, or indeed to keep them in business, not once have any of them said, anywhere in the list, that they wished that the Government would remove the requirement for planning consent. It simply does not happen. If you ask any small builder what they want, there is a whole range of things they would want—VAT is usually mentioned—that would come long before the need to remove the requirement for planning consent.
Are the Government seriously suggesting that somebody considering an extension to their property refrains from doing so simply because of the added cost of a planning application? I do not think that anybody is suggesting that; it would be ludicrous to suggest that the planning application fee is a serious inhibitor to going ahead with the extension to a home.
Article 4 is then pleaded in aid by the Government, who say that it can be used as a way to get around this. My noble friend Lord True has dealt with that very well and very fully, and I am not going to repeat those arguments. But I, too, had the letter from the Minister yesterday, for which I am very grateful, which dealt at some length with unanswered questions from Report about Article 4. As I said, the noble Lord, Lord True, has dealt with many of those, but it also gives us the figures for the use of Article 4, which some of us had said was little used. Well, these terms are relative. I will interpret the figures in the letter in a different way from what was intended. They show that barely one-third of local planning authorities have used Article 4 directives at all in the past three years, and that those that have done so have used them less than once in each of those three years. I would suggest that Article 4, by common consent, is not heavily used. Why? Because it is slow, bureaucratic, ineffective and inefficient, and again using the illustration of the noble Lord, Lord True, it can prove very costly in terms of compensation.
If an increasing number of local planning authorities start to use Article 4 directives when these proposals come in, will the Secretary of State continue to refrain from intervening, as he has up until now? Will he actually be content to see local authorities using Article 4 in effect to get around the proposals that the Government have just introduced? I would suggest that is highly unlikely.
As the noble Lord, Lord True, has said, today’s amendment provides a truly localist way of allowing the Government to introduce these proposals, if they are determined to do so, but also allowing local planning authorities to recognise that one circumstance does not fit all. Of course, different areas have different circumstances; the situation in rural Lincolnshire may well be very different from that in suburban Richmond or Sutton. It gives the local authority the right to choose what they do in terms of their local circumstances.
The Government proposals will set neighbour against neighbour, they will take away people’s rights to object and get a hearing, they take away the local authority’s power to arbitrate and mitigate, and they do absolutely nothing for growth. This amendment enables local authorities to decide how best to deal with these issues in accordance with their local circumstances. I am very pleased to support it.
The Earl of Lytton
My Lords, I, too, willingly added my name to the amendment tabled by the noble Lord, Lord True. I stand before your Lordships as a technician, not a politician. As a practising chartered surveyor with a specialised involvement with boundary matters, and as chair of my professional body’s panel on this matter, I can speak with some knowledge of what happens in practice. The professional panel I chair deals with boundaries, party walls, land registration and rights to light. I, too, thank the Minister for a very useful explanatory letter and a copy of the Article 4 procedural guidance. She referred to a condensed version, if I may put it that way, which the Government are intending to bring out. I have not seen that, but no matter because I shall stick with what the Minister has sent me.
The first point is that the desire to deregulate, however objectively beneficial it might seem, should not equate with no oversight whatever. That is the risk the noble Lords, Lord True and Lord Tope, have identified. It may be populist, but it is not good government.
The second point is that back garden space is an important mutual asset that underpins value and market appeal. We cannot get away from that. Of course, the situation varies according to location, as the noble Lord, Lord True, has said, so a one-size-fits-all approach does not really work. Rural village properties are totally different animals from those in London boroughs in terms of the built and human-scale environment.
The policy of deregulation does not guarantee a positive net present value, if I may use a piece of valuer’s jargon. One poor extension can blight neighbouring properties, as we have heard from the noble Lord, Lord True. Moreover, poor design and poor positioning are potent sources of neighbour disputes, and that is where people like me get drawn in. They produce serious stress not only between neighbouring householders but within families. I have seen families almost taken apart by the stress that has been occasioned. Such disputes often lead to expensive legal battles, in which I have to say the only gainer is the legal profession.
Lord Cormack
My Lords, you have only to go the Republic of Ireland to see that what the noble Earl, Lord Lytton, has just said is absolutely right. I believe we are well served by our planning laws in this country. I do not want to detain the House for more than a few moments but I remember so often, as a constituency Member of Parliament, finding constituents particularly aggrieved by specific applications. However, there was a way of sorting them out. I also remember the great leylandii problem, when we had to bring in legislation to protect people from these overpowering hedges.
My noble friend Lord True and those who have supported him have laid out an extremely powerful case, backed by technical competence and knowledge from the noble Earl, Lord Lytton. If ever there was a case for your Lordships’ House saying to another place, “Think again on this one; you have got it wrong”, this is it.
Lord Deben
My Lords, my great difficulty with the amendment is that, in the terms in which it has been proposed, what I believe to be a heresy has been expounded, which is there is an equality of rights between ownership and the right to have a say. The fundamental right is that of ownership and the protection of property; that is essential. That is why, when the Quality of Life report looked at this issue, we came up with a way out of the problem with which your Lordships’ House is faced. We said that this kind of issue was a matter not of planning but of neighbourly relations. Why not take it out of the planning system and have a situation in which people could normally do what they wanted, but if neighbours objected the local authority had the right to decide that such an objection was important enough to appoint an arbitrator? It is not a matter of planning most of the time; it is a matter of arbitration between the interests of the owner and those of his neighbours. The arbitrator should work within a context in which the owner would normally be judged as having the right to do what he wanted with his own property, but that if the neighbour’s rights were so intruded upon the arbitrator could make the decision that in this case it could not be done.
My problem with this situation is that the amendment reinforces the concept that through the blooming local authority is the only way in which the locality can have its say. I am not sure I believe that about local authorities; indeed it seems to me to be one of the issues. Localism is not “local authorityism”—it is localism. I note that very often those who speak about these issues talk as though the only way in which the locality can express itself is through the local authority. Frankly, I have seen far too much of local authorities’ fiddling powers, as they try to tell people the best way to do their developments. I remember having an argument with a charming lady on the subject of what sort of window Teulon would have put in a house that Teulon had built. The difficulty was that she was from the authority and I knew about Teulon, which is a difficult situation to be in. I recognise that there are problems of this kind.
I say to the Minister that it is not possible to support this amendment because we are still in this difficult area. I share the assessment of my noble friend Lord True of the Minister’s ability and her heart in these circumstances, so I say this delicately. She has not been enabled to give the House the kind of way through that exists—a balanced way, given by the recommendations of the Quality of Life report. Can she explain why the Government seem not to have taken that moderate path but have moved to this one? On balance, this one is better than the amendment but it has the great difficulty that if there are many cases of the sort feared by my noble friend Lord True, we will be back here legislating to put the thing back. It is a worry. Can she explain why, on this occasion and, I am afraid, all too regularly, the Government have not sought to find a way that might ameliorate the problem and lead more of us more happily through their Lobby?
Lord Marlesford
I support my noble friend Lord True. I speak from the grass-roots point of view, which will, I hope, answer the point made by my noble friend Lord Deben.
The role of the parish council is crucial in these issues. It is the grass roots of democracy and government. My noble friend Lord True is right about the need to have proper arbitration and consideration in the way his amendment will allow in the council areas that wish to take that route. My noble friend Lord Deben talks about having an arbitrator appointed by the local authority in due course. That seems a little circular, because frankly we are talking about making these matters subject to local arbitration.
My own parish council in the small village in Suffolk in which I live, which I chair, at the moment has two cases of people who wish to extend their houses. They will be considered at the grass-roots level by people who know everyone and they will both be settled very amicably. This is known. However, if you get people who are not prepared to take account of local considerations, preferences and feelings, you will soon run into frictions that could so easily be avoided.
It is for that reason that I will support my noble friend Lord True if he decides to test the opinion of the House.
Lord McKenzie of Luton
My Lords, the noble Lord, Lord True, has been clear and consistent on this matter, and he has our support. I am delighted that he also has: the support of the noble Lord, Lord Tope, who said that, given the statistics, there cannot be much wrong with the current system; the authoritative support of the noble Earl, Lord Lytton, as a distinguished technician; and the support of the noble Lord, Lord Marlesford. I should say to the noble Lord, Lord Deben, that we are not in the place that he describes. Is it not better that a local authority engages with communities and tries to get the balance that these kinds of issues throw up rather than the Secretary of State? Local authorities might not be the fount of all knowledge, but I would rather have local authorities involved in local decisions than the Secretary of State. I think that is also the view of the noble Lord, Lord Cormack.
The noble Lord, Lord True, has argued his case on the basis of localism, the lack of proper consultation, the insignificant effect on growth, the riding roughshod over neighbourhood engagement, the unpicking of the hitherto planning balance and the inadequacy of the Article 4 remedy. However, we should be grateful to the noble Baroness, Lady Hanham, as others have said, for the further information that she has provided, particularly on the Article 4 direction.
The Government, of course, have a wider agenda around permitted development rights, and like other noble Lords who have spoken we deprecate the fact that the Government have not yet felt able to publish their response to the consultation, which closed in December last year.
The amendment of the noble Lord, Lord True, is very specific and modest. It applies only to permitted development within the curtilage of a dwelling house, and it disapplies those rights only when a local planning authority resolves that they do not apply. Unless and until that happens, the permitted development rights endure. If the permitted development rights do not apply, any proposed development has to go through the normal planning process. It is, as the noble Lord said, about equity.
Of course we acknowledge the role that the construction sector can play in generating employment and growth, but that is not to say that it should be gained by tearing up sections of the planning system. We can tell from the noble Baroness’s letter that the Government will cling to the Article 4 defence. The Minister’s recent letter suggests that the process of getting an Article 4 direction is straightforward. It records that the Secretary of State has not exercised any powers of intervention since the change in 2010, which only required directions to be notified.
If in practice the Secretary of State is hands-off, why not, as the noble Lord’s amendment suggests, just leave it to the local planning authorities in the first place? Let them decide whether permitted development rights of the type described should run. However, on reading the guidance it is clear that matters are not quite as straightforward as the Government argue. We have all read the LGA briefing, which spells out why Article 4 directions are ineffective, particularly on compensation issues and loss of planning fees, as has been mentioned.
It is to be hoped that the Government will find themselves able to accept this amendment, and we look forward to the Minister’s reply. But if the noble Lord, Lord True, does not get satisfaction, we will join him in the Lobby. I believe it is right that we should seek to settle the matter today.
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)
My Lords, I thank the noble Lords who contributed to this debate, and for the measured way in which they have considered the amendment. I know very well that my noble friends, who I have called noble friends for a long time, are very committed to what the noble Lord has put forward.
I will not be able to accept the amendment. I say that at the outset so that it is quite clear. It has been generated by the Government’s proposals, on which consultation has taken place, on the changes to permitted development rights in respect of single-storey extensions. This was never meant to be part of the Bill. Noble Lords have asked why the consultation has not been published. We normally publish the results of consultation when we are about to take the matter further, and I have already made it clear that the consultation will be available as the regulations come forward. As I say, that aspect is not part of the Bill.
Our proposals, which are not part of the Bill, will make it easier for thousands of families to undertake improvements to their homes. In bringing forward these changes, we have looked across England and recognised that many people want to enlarge their homes, not by much but sufficiently to create more living space and to provide the best possible home for their family without the cost of having to relocate.
We also consulted on changes for commercial premises. Noble Lords have not really referred to this, and I say only that the proposal is that businesses will also be able to improve their premises and expand without having to relocate. This means that they can quickly respond to and capitalise on market conditions. We believe that the proposed changes will help promote economic growth and generate new business for local construction companies and small traders. That is not the full rationale behind this, but it is an important matter that we keep local businesses going. It is fair to say that approximately 30 jobs are supported for every additional £1 million spent on housing repairs and maintenance.
Permitted development is the recognition by the Secretary of State that certain types of development and their impacts are generally acceptable across the country. It accepts that a requirement to make a planning application is not always proportionate to the impacts of development. This is an important principle. We have consulted, as I have said, on the changes that would apply across England. We did not consult on a proposal whereby a local authority could just choose whether or not to adopt what has been promised to all householders across the country. That is what the noble Lords who support this amendment suggest.
We have not consulted on anything like that. We have been clear in working out the proposed changes that the planning system for permitted development rights needs to strike a balance, to which noble Lords have referred, between the rights of the homeowner and the rights of their neighbours. We consider that that is what our proposals do.
We have had reference to the National Planning Policy Framework. To be clear, there is no weakening of it. It is aimed at preventing what I believe from discussion on the Localism Bill is technically called garden-grabbing for new development. We do not believe that the proposals that we have put out to consultation will affect that. No more than 50% of the curtilage of a dwelling can be built on, providing substantial protection for rear gardens, particularly in terraced properties. Also, the building regulations and the Party Wall etc. Act, to which my noble friend Lord Lytton referred, must be complied with in the usual way, and the right to light is unaffected.
My noble friend Lord Lytton took me up on my point about the right to light being statutory. I will be pedantic, if I may. The operation or prescription of the right to light is set out in statute, although the right arises under common law, as he suggests. Between us, we have probably come to the right conclusion, which is always helpful.
To give a local authority the power to opt out of the national permitted development, as the amendment does, would establish an unwelcome precedent. It removes the certainty that the Secretary of State promises in bringing forward a new right, and makes what is intended to be a national deregulatory measure apply only on an optional basis. That is particularly so when a mechanism for responding to concerns in individual areas exists.
My noble friend Lord Deben suggested that some of the problems could be solved by setting up a local arbitration arrangement. He and other noble Lords will know that many councils already provide a mediation service, and of course they would be perfectly entitled to do so under the regulations proposed. I agree that those issues can be appropriately resolved without the formal intervention of the planning system. It just requires a bit of good will.
There are already arrangements in place to deal with some of the circumstances raised in respect of some individual local authorities, where the new rights might impact adversely on a local amenity. Many have commented on the Article 4 directions, on which I have relied as an alternative to what my noble friend suggests. Boringly, I shall make some of those comments again. There has been difference of view about how the Article 4 directions work. It has been suggested that the Article 4 direction process is very difficult to pursue. The Local Government Association briefing contends that. As has been cited and as I said in my fairly long letter, which may have been helpful in some ways, more than 270 Article 4 directions have been notified to the Secretary of State from 122 local planning authorities over the past three years. This does not suggest to me that local authorities will not introduce Article 4 directions if they think they are appropriate. A number of local authorities will.
In its briefing, the Local Government Association set out three core reasons why it believes that Article 4 directions are ineffective. Some of those reasons have been raised by noble Lords. The first focuses on the need for councils to give 12 months’ notice of an Article 4 direction proposal. Local authorities have powers in respect of householder-permitted development to make immediate directions to withdraw the permitted development rights with immediate effect. Article 4 directions that have been put on at once must then be confirmed by the local planning authority following local consultation within six months. It in effect lays down what an Article 4 would do but in a very short timescale, so you could really halt a development or the extension of a development.
Lord True
My Lords, I thank my noble friend on the Front Bench for the characteristically courteous and thoughtful way in which she has responded. My difficulty is that the response has been a response in style and that she has, unfortunately, not been permitted to respond on the substance of the matter. I did not create this situation. A pronouncement came from the Government that they intended to withdraw the rights of neighbours to object to extensions on this scale and thus oust their right to go to a tribunal, which is the planning committee. The planning committee process acts as a mode of reconciliation in itself. Compromises are made and often the matter never goes to a formal hearing. It is a way in which neighbours are reconciled in these situations.
Of course, I hear what my noble friend Lord Deben said. Arbitration is used. I certainly do not claim that a local authority is the beginning and end of all wisdom. I spend half my time as a local authority leader trying to involve local people and local communities in taking decisions for themselves. I am absolutely convinced that a local authority will have rather more knowledge of what is acceptable and appropriate in its local area than a Minister sitting in Whitehall pronouncing an order of this kind. That is my difficulty with what my noble friend said.
I am extremely grateful for all the speeches that were made so very supportively. I thought that they made a compelling case, taken together, for the Government to listen to the arguments we are putting forward. With some modesty, as a policy-maker in the past, I think that at some point Governments gain in authority when they show that they have the grace and wisdom to listen sometimes on small things.
I will not detain the House further. The Minister said that it was worrying that local authorities might wish to opt out of a pronunciamiento about planning—to have a different view. How recently it was that we debated at such length the principle of localism. While I do not contend that local authorities have the whole answer, I do not think that Whitehall having the answer is necessarily right. The House can decide only on what it has before it. I have had the temerity to raise this issue because it is clear that we have not seen the results of the consultation and it has been confirmed that the Government intend to plough forward to regulations, which are unamendable. I have had the temerity to put this before the House partly because it is a matter of great importance to people who live in small properties, cheek by jowl in the suburbs of this country, partly because Members of Parliament, who are elected and responsible to those people, as I myself am, might have a view on this matter and partly because I do not think that the Government have the full answer, any more than local authorities do.
I repeat what I said at the start. It is with the greatest reluctance, sadness, difficulty and regret, after 40 years working for my party, representing it in elected chambers and now having the great honour to be here, that I say I cannot accept the advice of my noble friend. I would like to test the opinion of the House on this matter.
The Deputy Speaker (Baroness Pitkeathley)
If Amendment 2 is agreed to, I cannot call Amendment 3 for reasons of pre-emption.
Amendment 2
“(4) Sections 106BA, 106BAA and 106BB of the Town and Country Planning Act 1990, and subsection (5) of this section, are repealed at the end of April 2016.
(5) The Secretary of State may by order amend subsection (4) so as to extend the time being specified in that subsection by up to 24 months.”
Lord Tope
My Lords, the amendment stands also in the name of my noble friend Lord Shipley. We have debated this clause extensively, under its former guise of Clause 6, at every stage of consideration of this Bill so far and it is certainly not my intention today to reopen debates on the many issues that the clause raises. They have been fully debated; I think that views still differ but, as I have said so often, we are where we are.
On Report, the Government, having listened to at least some of the concerns that were expressed, introduced a sunset clause to bring the clause to an end on 30 April 2016. I welcomed that sunset clause and the evidence that the Government had at least listened to those concerns. However, the government amendment on Report also gave the Secretary of State power to extend the provisions, if judged necessary, for in effect an unlimited period. My amendment today therefore seeks to limit any such extension, should it be deemed necessary, to no more than 24 months.
I am sure that the Minister will say that the clause was introduced in recognition of the current economic circumstances and in the expectation that they would not continue for ever. Indeed, in introducing the sunset clause for April 2016, the Minister was at pains to express that that date had been chosen not arbitrarily but because that was when it was suggested and expected that—I hesitate to say the boom would begin—circumstances would recover.
I am sure that it is the Government’s intention that these provisions should cease to exist on 30 April 2016, but concern is rightly felt that there could be circumstances—after a general election, there will be a new Government of whichever hue—in which the provisions could carry on indefinitely, which many of us feel to be wrong. Our attempt, therefore, is to limit the clause to two years. By that time, under the National Planning Policy Framework, all local authorities should have drawn up their local plan—70% have already published one—and those up-to-date plans will ensure that every planning requirement is viability-tested, which should in turn render this clause redundant.
I should like to think that the Government are able to accept the amendment. If they are not, I hope that the Minister will express her sympathy and support for its intentions and put that on record. While that is not as good as its being in the Bill, it is at least some reassurance for now and for the future. I hope that, in doing so, she will also indicate that any future Government, if they are minded to extend the provisions of this clause, will come forward with robust evidence that proves that affordable housing obligations are routinely stalling developments. I am not sure that we are convinced of that now, but, if there is to be any extension, it will certainly be incumbent on the Minister of the time to provide the evidence to convince both Houses of Parliament that it is necessary, and both Houses of Parliament should have the opportunity to decide on those matters.
I do not think that I need to detain the House any longer. The purpose of the amendment is quite clear. I beg to move.
Lord McKenzie of Luton
My Lords, I shall speak to Amendment 3, which is intended to have the same effect as Amendment 2. If it is pre-empted by Amendment 2, I would be more than happy with that outcome.
At the moment we have a sunset clause that is in rather an unsatisfactory situation. Effectively we have the right for developers to renegotiate affordable housing obligations on which the sun indeed may never set. As the noble Lord, Lord Tope, said, now is not the time to revisit our broader concerns about these provisions. On Report the Minister justified the three-year primary period of the sunset clause by quoting evidence from the OBR that showed that investment in housing is expected to stabilise in 2016, yet she argued the need for a pragmatic power to extend this if prevailing market conditions justified it.
This is a hard argument to maintain unless the Minister is anticipating a further deterioration in the housing market. By 2016, developers will have been negotiating affordable housing obligations in circumstances of recession, or of zero or little growth, for about eight years. The amendment allows for a possible further two years, so it would then have been for a full decade. Perhaps the Minister can be more specific about the nature of the catastrophe that she considers might beset the housing market that would justify retaining residual powers beyond 2018.
The March 2013 OBR report does not seem to help, as it comments on the variety of housing measures that the Government have promulgated, noting that overall, together with the Funding for Lending scheme, the measures should support significant growth in property transactions and residential investment at levels that we forecast for the next two years. The Government may have got something right; is the Minister saying that the OBR has got it wrong?
The justification for a possible two-year extension of the sunset clause is pretty thin. The opportunity to keep Clause 7 in being beyond this is not justified, unless it is intended to be held up as some sword of Damocles to ensure that future affordable housing obligations are depressed. We agree with the noble Lords, Lord Shipley and Lord Tope, that a maximum of two further years of the sunset clause is okay but not more than that. Like the noble Lord, Lord Tope, we hope that the Minister can reassure us on that so that we do not need to test the opinion of the House.
Baroness Hanham
My Lords, we have discussed this extensively at all stages of the Bill and I hear the arguments that have been made again today. Since Report, I have also had the opportunity of discussing this with representatives of the National Housing Federation and that has been helpful.
I am pleased and always have been that the principle of a sunset clause to repeal the clause in April 2016 is generally supported. However, these amendments focus on the power given to the Secretary of State to extend the provision by order beyond 2016. The noble Lord, Lord McKenzie, has referred to the date of April 2016 in the Office for Budget Responsibility’s market forecasts as a sensible and justified sunset date. We do not know whether things will have improved by then and I am sure that the noble Lord does not either. One can only hope that they will have. If they have not, we would want to retain an option to extend the measure if market uncertainty remains. We have hoped that we would dig ourselves out of the economic crisis over the past couple of years but it has not been possible. One cannot say with total confidence that 2016 will see us out of the doldrums but we expect and hope that it will.
The issue at stake is not the sunset clause, which has already been agreed, but how any future extension should be constrained. I sympathise with the wish for certainty and I hope it is reasonable to expect that there will be economic stability by 2018, and that consequently there will be little need for extension of the provision. However, while I agree that 2018, as proposed by my noble friend, seems a reasonable limit for this clause, it is as arbitrary a date as any and would limit future flexibility.
To retain flexibility is prudent. With flexibility by order the matter could be taken forward. If it had to be, the Government would have to come to both Houses, because it would be an affirmative order. My noble friend asked what evidence they would have to bring: I suggest that it would have to be the best evidence that they could find, which would presumably at least refer to the amount of affordable housing that still needed negotiation. Both Houses would have to consider this in the light of any evidence that the Government had at that stage.
I am also wary of having a fixed date of 2018, or a fixed extension period, because the clause introduces a new application and appeal process. Viability alone and not policy requirements or scheme merits is the subject of the application and appeal. The on-the-ground impact will not be known until the clause has been in operation for a little while and we have seen how the viability process works. It is essential, therefore, that we maintain flexibility to understand the impact of the measure over a little time. Along with more certainty in market conditions, this would give better ground for assessing the merits of any extension during 2015 when consideration would have to begin as to whether the extension to 2016 should be made.
The clause is drafted so that the order must insert “a later date”. It does not allow for a permanent provision. This wording reflects our intention that this clause will operate only for as long as it is required. Its intent is to be temporary. A permanent provision would require new primary legislation. Finally, it could be argued that the real future of this clause is in the hands of local authorities. If local planning authorities take account of their local economic realities and negotiate viable and flexible agreements with developers, there will be little scope for challenge.
Since we debated these provisions on Report, I have arranged a meeting for interested Peers—those who have spoken—on the draft viability guidance that will accompany this clause. I am grateful that the noble Lords, Lord Tope, Lord Shipley and Lord Best, responded to that invitation and were able to give us some thoughts on the matter. It was perhaps a little unfortunate that we did not have a bigger turnout but I am sure that everybody was busy.
Lord McKenzie of Luton
For the record, I think I was engaged on other legislation at the time.
Baroness Hanham
That would have made four.
I hope these discussions have assured noble Lords that we intend this to be a strictly dated clause, but the flexibility is needed. It will allow for adjustment of affordable housing requirements only where it is justified and clearly evidenced. In this way, we expect to deliver more housing, both private and affordable, than would otherwise come forward. I think everybody in this House agrees that that is essential.
This is not intended to be a permanent measure. We are happy with the sunset clause but think that we might need a little extra time. This is the easiest way of doing it without having to bring in primary legislation. We can extend this on an affirmative order. I hope that the noble Lord will feel satisfied and will withdraw his amendment.
Lord Tope
My Lords, I am grateful to the Minister for her reply and for the reassurances she was able to give. I draw comfort from the fact that first and foremost the answer lies with local authorities getting their local plans in place and ensuring that any agreements they negotiate or are negotiating are properly viable. I accept that in the first instance it is for local authorities to do. I thank the Minister for her confirmation of what we knew, which it is useful to have on the record, that this measure is subject to the affirmative procedure and that, should the Government of the time wish to extend, they will have to produce evidence to both Houses. I hope that both Houses will do their utmost to ensure that there is robust evidence should that eventuality arise. Most of all, I draw some comfort from my expectation that it will not prove necessary. That is, I think, a hope shared on all sides of the House. I believe that will be the case. Time will tell, but in the mean time, I beg leave to withdraw the amendment.
Lord Cavendish of Furness
“(2C) In complying with any duty under subsection (2B), if it appears that there is a conflict between any of the duties under this section, the Secretary of State shall attach greater weight to his duties under subsection (2B).”
Lord Cavendish of Furness
My Lords, in the imminent absence of my noble friend Lord Marlesford, I shall introduce Amendment 4. This amendment refers in large part to broadband, so I should declare an interest in that my family business is based in Cumbria and most certainly stands to gain from improved broadband provision.
The importance of broadband was extensively debated last week when the Communications Committee’s report Broadband for All—an Alternative Vision was so ably introduced by my neighbour and noble friend Lord Inglewood. He emphasised the special importance of broadband in rural areas, and I agree. I have long argued that renewed growth in Britain will come—indeed, is already coming—from small and medium-sized businesses, many of them rural. That came home to me forcefully last week when I was returning from your Lordships’ House. The train to Cumbria came to a frozen halt at Lancaster. The train operator kindly provided taxis for six of us to go further up the branch lines. To my amazement, all six of us, who live dotted around in the villages and hamlets near me, were all on a day trip to London selling our goods and services. This is interesting because it was completely unheard of only a few years ago. I tell the story because there is a strong danger that the anticipated broadband take-up will be underestimated. In a sense, that is very good news, but there are implications.
I am grateful to the Government for amending Clause 9 on Report. It means that the primary legislation governing national parks and AONBs will remain unchanged, which is a welcome improvement. However, my noble friend tabled this amendment because he remains concerned that Clause 9, even as amended, undermines the legal protection for national parks and areas of outstanding natural beauty, and I share his concern.
In amending Clause 9, the Government were reacting to concerns that the clause disapplied key duties on the Secretary of State to have regard to natural beauty in protected areas. The new approach, in the Minister’s own words:
“ensures that the duty that already exists under Section 109 of the Communications Act 2003 for the Secretary of State to have regard for the environment and beauty of the countryside will be deemed to meet the ‘have regard’ duties set out in protected areas legislation, when the Secretary of State comes to make regulations under Section 109”.
The aim of the changes the Government made to Clause 9 was, again in the words of my noble friend Lady Hanham, to reassure,
“the House that our intention was only to ensure that the right legal framework was put in place and that we had no wish to unpick the distinct and settled legislative framework that applies to the national parks”.—[Official Report, 12/3/13; col. 141.]
This change is welcome, as far as it goes, but it is important to note that many outside this place remain concerned about the precedent it sets for protections for our national parks and areas of outstanding natural beauty. The view of the Campaign to Protect Rural England’s legal advisers is that Clause 9 as amended by the Government replaces the special protection for national parks and AONBs with the general protection given to all countryside areas under Section 109(2)(b) of the Communications Act 2003. If the Secretary of State has had regard to the matters mentioned in that section, that will be sufficient for the purposes of Section 11A(2) of the National Parks and Access to the Countryside Act 1949. In other words, the special treatment and priority given to national parks would be lost; they would be treated in future like any other area of countryside.
At a practical level, this means that the clause, even as amended by the Government, continues to allow the introduction of proposed new regulations that will make it much easier for telecommunications companies to put up overhead wires and poles in protected areas without applying for planning permission. The CPRE continues to believe that Clause 9 is unnecessary and that new telegraph poles in national parks and AONBs should continue to require planning permission, which would not pose a barrier to broadband infrastructure rollout.
This amendment seeks to clarify that where any of the duties that the Secretary of State must have regard to under Section 109(2) of the Communications Act 2003 come into conflict when the Secretary of State is making regulations, he or she must give greater weight to the “have regard” duties for protected landscapes. The expression “greater weight” is used in Section 11A of the National Parks and Access to the Countryside Act 1949, and it is proposed to use it in this clause to underline the special status of our protected landscapes in the decision-making process for the Secretary of State.
This is an important point of principle. Our national parks and AONBs are designated as such for a reason: they are recognised as being special landscapes, and thus worthy of special protection. It has been said that the ideal for the national parks set out by the Dower report and reiterated by the Hobhouse committee in the post-war years, and held steadily since then by politicians from all parties, “is none other than the protection of these finest landscapes of England and Wales in so effective a way that their local life shall vigorously continue, while the beauty of the countryside, untouched by any damaging influence or urban encroachment, shall be maintained as a thing splendid in itself, giving poise and strength to those who appreciate it and adjusting man’s overweening ideas of his own importance through the quiet influence of the unchanging hills”.
Baroness Whitaker
My Lords, I declare an interest as the president of the South Downs Society. I support this amendment very warmly. I have very little to add to what the noble Lord said—I could not have put it better myself—but I urge the Minister to keep in mind that the national parks are one of the greatest achievements of this country, and that we should be very careful how we safeguard their value, which has provided benefit to millions.
Lord Cameron of Dillington
My Lords, I, too, support the principle behind the amendment in the name of the noble Lord, Lord Marlesford, which was ably moved by the noble Lord, Lord Cavendish. Again, as in Committee on this Bill, I come from an economic perspective. As I said then, the whole economy of our national park areas comes from the beauty of their landscapes, which we must try to preserve at all costs. Their beauty brings income from visitors, both national and international, and from the whole question of the branding of the businesses, now and in the future, that exist within their boundaries. It would be very easy to chip away at the uniqueness of this branding: little bits here and there, often for seemingly urgent reasons at the time.
In fact this clause, in its original form, was saying just that: we must have broadband within these rural areas at all costs, and we do not care too much about how we achieve it. I agree; we must have broadband at all costs, but we must pay attention as to how we achieve it. Although broadband is of great economic importance, the landscape is of greater longer-term economic importance. Therefore, we and the Secretary of State must always put the landscape first. It must be the overriding long-term priority in the management of these areas, and I hope the Minister will be able to give us some comfort.
Baroness Hanham
My Lords, we had a long discussion on Report on many of the areas that have been raised again today. As noble Lords know, the Government have brought forward a number of amendments to respond to the concerns that had been expressed, particularly on some of the issues raised on the nature of the national parks and the areas of outstanding natural beauty. I certainly hope that I said on Report that we consider these areas to be exactly what they are meant to be. They are special areas, lungs in the countryside for people, recreational areas, and clearly they have all the beauty of England. Nobody wants to despoil that.
It may be helpful if I briefly review where we got to on Report. I hope that I reassured noble Lords at that stage that we were seeking to ensure that broadband—fast broadband—was available, particularly in rural areas, because many businesses in these areas will survive and thrive only if they have access to broadband. That is what we were trying to do. As I said, nobody has any wish to impede or impose on rural areas.
I will take a moment to remind the House of the position that we reached on the broadband provisions. It is our intention, through Clause 9, to ensure that there is sufficient legal certainty in primary legislation when bringing forward our proposed changes to secondary legislation. The clause as it was when introduced to this House expressly disapplied the duties in national parks and area of outstanding natural beauty legislation to have regard to environmental considerations. However, many of the concerns that this would set an unwelcome precedent for the future were raised by noble Lords, the English National Park Authorities Association and the National Association for Areas of Outstanding Natural Beauty.
I was able to have meetings with representatives from those associations, and I am very grateful to them for coming in to talk to us. As a result of those discussions, we were able to propose an amendment to the clause that addressed their concerns while ensuring that we had the necessary legal certainty to bring forward regulations. To my noble friend who moved these amendments, I point out that the initial amendment was about having regard to duties. We satisfied those associations and the House that those amendments achieved what everybody wanted to achieve: protection for these areas, as well as recognising the need to move forward.
Clause 9 amends Section 109 of the Communications Act 2003 so that the Secretary of State must have regard both to the need to protect the environment, and in particular to conserve the natural beauty and amenity of the countryside; and the need to promote economic growth in the United Kingdom. The duty to consider the need to promote economic growth was introduced because of broadband’s pivotal role in boosting economic growth, making the country more competitive and creating jobs. This is particularly important in rural areas, which, as I have just said, are most in need of upgraded infrastructure.
I reassure the House that the introduction of this new duty does not mean that protection of the environment is a lesser duty. It is not. The Government remain convinced that protection of the environment is crucial. That is why a code of best siting practice is being developed as a safeguard to ensure that fixed broadband equipment is sensitively sited. The noble Lord drew attention to the fact that we have already said that BT would have to share its infrastructure.
As I set out on Report, a working group has been established to draft this new code. It has agreed its scope and some broad principles, which I shared ahead of Report. Its next meeting is tomorrow, where it will continue its work towards the final code being ready for publication ahead of the secondary legislation being brought forward. I remind the House that the working group is made up of communications providers, local planning authorities, Ofcom, the Office of the Telecommunications Adjudicator, English Heritage and the English National Park Authorities Association, and all members are keenly engaged in bringing this important code to fruition.
I reassure noble Lords again that all existing provisions of the national parks legislation will be unaffected by this Bill’s provisions, except for Section 11A(2) of the 1949 Act, which will be complied with through the duty in the Communications Act 2003. This was resolved by amendment on Report. The Secretary of State has to be proportionate when exercising these powers, and any regulations are subject to both consultation and parliamentary scrutiny.
The noble Lord raised several questions, some of which I think I have answered and some of which I fear I may not have done because they were rather more technical than anticipated in my brief. I will write to him on the ones that I think I have not covered, but I hope I have given him enough reassurance that we are wholly committed to the countryside and that we recognise all that it provides. Having said that, and following the long debates that we have had on this subject and the amelioration that we have been able to make to the original provisions, I hope the noble Lord will feel able to withdraw his amendment.
Lord Cavendish of Furness
My Lords, I thank the noble Baroness and the noble Lord, Lord Cameron, for their support for this amendment, and I thank my noble friend the Minister for her reply. As she said, I do not think that all the questions have been answered. She was rather surprised when I rattled them off rather quickly. I sense that her heart is exactly in the right place as regards the countryside. With the assurance that she will write to those noble Lords who have taken part, I beg leave to withdraw the amendment.
Baroness Hanham
Baroness Hanham
This last amendment is a very minor, straightforward tidying up of legislation. It follows from the new clause that we inserted on Report on the delegation of the planning powers of the Mayor of London, now Clause 28 in the Bill. That clause deletes Section 2B(8) of the Town and Country Planning Act. As a result, we will no longer need to refer to Section 2B(8) in Schedule 1 to the Bill, so the amendment removes that reference.
With the leave of the House, as this is the last opportunity I will have before the Bill is sent back to the other place—clearly, we will see it back again in some form—I place on record my appreciation of the work done in this House by all noble Lords who have taken part. I thank them for the great persistence and consistency with which they have addressed the issues. We have made significant amendments to this Bill and have put in four new clauses, so I thank all noble Lords and those who have assisted us with this Bill, including my noble friend Lord Ahmad. I beg to move.
Lord McKenzie of Luton
My Lords, we have no problem with this amendment. I reciprocate by thanking the noble Baroness and her team for the extreme courtesy with which they have handled this Bill and for the very extensive discussions that the noble Baroness has organised, some of which one could get to and some of which one could not. I also thank the Bill team for its helpful input.
Justice and Security Bill [HL]
(11 years, 8 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
21:21 - Division on Amendment 6A - Ayes: 158 / Noes: 174 - Amendment 6A disagreed.
22:00 - Division on Amendment 19B - Ayes: 65 / Noes: 141 - Amendment 19B disagreed.
Lord Taylor of Holbeach
That this House do agree with the Commons in their Amendment 1.
The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach)
My Lords, I beg to move that your Lordships do agree with the Commons in their Amendment 1. I shall speak also to Commons Amendments 2 and 3, 26 to 43 inclusive, and 45.
Part 1 of the Bill makes significant changes to the system for independent oversight of the intelligence agencies and the wider intelligence community. It extends the Intelligence and Security Committee’s statutory remit, granting it additional investigative powers. It changes the ISC’s status to a committee of Parliament created by statute. The ISC in future will be appointed by Parliament and will report to Parliament as well as to the Prime Minister. The Bill also extends the remit of the Intelligence Services Commissioner.
When the Bill was last in this House, we had a series of detailed and well informed debates. At Report I made a commitment that we would bring forward amendments in the Commons concerning the status of the ISC. We have done that. We have also moved a number of other amendments in the Commons that address concerns that were originally raised in this House.
I turn first to Commons Amendments 1, 41, 43 and 45. These concern the status of the ISC. During the debates in Committee and at Report, there was some very well informed debate about the future status of the ISC. The noble Lord, Lord Campbell-Savours, who I regret is not in his place today, made the case for the ISC becoming a Select Committee. The noble Lord, Lord Butler, and my noble friend Lord Lothian, current members of the ISC, argued for changing the name of the ISC to the Intelligence and Security Committee of Parliament to make clear the parliamentary character of the ISC. Following that debate, I announced the Government’s intention to make clear the parliamentary character of the ISC and to make a number of necessary consequential amendments. The amendments that the Government moved in the Commons would deliver on the Government’s intention.
Amendment 1 would adopt the amendment first tabled by the noble Lord, Lord Butler, and my noble friend Lord Lothian, and would change the name of the Intelligence and Security Committee to the Intelligence and Security Committee of Parliament. Amendments 41 and 43 would make the equivalent changes in Schedules 2 and 3. These amendments would more fully realise the Government’s intention that the ISC should be a committee of Parliament, created by statute.
Commons Amendments 40 and 42 are closely related to the “of Parliament” amendments that I have just discussed. The Data Protection Act 1998 applies to Parliament but with special rules to determine who the data controller is. The data controller is the person within any organisation on whom most of the obligations under the DPA fall. Section 63A of the DPA states:
“Where the purposes for which and the manner in which any personal data are … processed are determined by or on behalf of”,
either House,
“the data controller … shall be the Corporate Officer”,
of the relevant House. It is not appropriate that the corporate officer should be the data controller for data processed by the ISC, but this is the likely effect of Section 63A once the ISC is a committee of Parliament. For that reason, Amendment 40 would add a provision to disapply Section 63A of the DPA so far as the ISC is concerned so that, notwithstanding that the new ISC will be a committee of Parliament, its data controller can continue to be its clerk.
In addition, both the House of Commons and the House of Lords are subject to the Freedom of Information Act 2000—the FOIA. As a committee of Parliament, it is arguable that the ISC, too, would be subject to the FOIA, as other Joint Committees are. To avoid this consequence, Amendment 42 would add a provision to the Bill which would amend references to the House of Commons and House of Lords in Schedule 1 to the FOIA to make it clear that they are not subject to the Act as regards information held by the ISC. This amendment would preserve the status quo, in that the FOIA does not apply to information held by the ISC now and it would not do so in future.
In addition, Amendment 42 would add the ISC to the list of bodies in Section 23 of the FOIA. The result of this would be that ISC information—information which has been supplied to or by the ISC, whether directly or indirectly, or which relates to it—in the hands of another public authority subject to the FOIA would be exempt information for FOIA purposes.
We now turn to Commons Amendment 39, which would provide statutory protections for evidence given by witnesses to the ISC. First, such evidence may not be used in any civil or disciplinary proceedings. Secondly, evidence given by a person who is a witness before the ISC may not be used against that person in any criminal proceedings. These provisions would replicate an important part of the protection that witnesses before a Select Committee have by virtue of parliamentary privilege. They would provide encouragement to witnesses appearing before the ISC to be full and frank in their evidence. The protection against the use of evidence in criminal proceedings would be narrower than the equivalent protection for civil and disciplinary proceedings. They would not impinge on an individual’s right to defend him or herself in criminal proceedings. Of course, evidence that is deliberately misleading is of no assistance to the ISC. Accordingly, the protections would not apply to evidence given by a witness to the ISC in bad faith.
On Commons Amendment 26, I said at Report that one possible consequence of the “of Parliament” change is that the ISC would have the power to take evidence on oath. Following further analysis, we concluded that the consequence of changing the status of the ISC to become a statutory committee of Parliament was that the ISC may, in future, take evidence on oath. Our view was that existing statutory powers applicable to Commons and Lords committees would give the ISC the authority to administer oaths. This view shaped amendments which the Government tabled, and which were agreed to, in Committee in the Commons. However, the House service raised a concern with the Government about this, disagreeing with our analysis that the “of Parliament” change gives the ISC the authority to take evidence on oath. Its view is that the Bill should contain an express power for the ISC to take evidence on oath. In response to that concern, the Government tabled an amendment in the Commons to put the ISC’s power to take evidence on oath beyond doubt. It is not necessary that the Bill specify who has the power to administer oaths on behalf of the ISC; that can be left for the ISC to determine, under its general power to determine its own procedure.
Commons Amendments 2, 3, 28, 29, 30 and 31 concern the ISC’s ability to oversee operational matters. The Bill extends the ISC’s statutory remit, and makes clear its ability to oversee operational matters. This is a crucial part of the Bill’s aim of strengthening oversight. The amendments would both extend and clarify the ISC remit to oversee operational matters; they respond to concerns of the ISC that were raised by the noble Lord, Lord Butler, during debates in this House. The noble Lord’s first concern was that there may be exceptional circumstances in which the Government might want the ISC to consider particular operational matters falling outside the existing criteria. His second concern was that the requirement that both the ISC and the Prime Minister be satisfied that the criteria for operational oversight were met might slow down the provision of information to the ISC on routine operational matters.
In response to these concerns, the amendments made in the Commons would mean that the Bill would provide for three routes by which the ISC may consider particular operational matters. The first route is the one that was already in the Bill—when the Prime Minister and the ISC are agreed that the matter is of significant national interest and is not part of any ongoing intelligence and security operation. The second route is when the Government request the ISC to consider a matter notwithstanding that either or both of those criteria are not met. This meets the first concern raised by the noble Lord, Lord Butler. The third route is where the ISC’s consideration of a matter is limited to considering information provided to the ISC voluntarily by the agencies or another government department. This meets the second concern raised by the noble Lord.
For the first and second routes only, the ISC and the Prime Minister would need, additionally, to be satisfied that the consideration of a particular operational matter is consistent with the memorandum of understanding agreed between them. The ISC’s powers to require the agencies or other government departments to provide it with information would be available in the first two cases, but not for the third—on the consideration of information volunteered to the ISC. This would be the effect of Amendment 3 and consequential Amendments 28 to 31.
Amendment 27 addresses the future resourcing of the ISC. In Committee in the Commons, the Minister for Security made clear that it remained the Government’s intention that we should make the ISC more parliamentary and move it away from Government. Officials from government, the House service and the ISC secretariat have discussed what we think will be an acceptable solution agreeable to all parties. This is that the ISC secretariat should become a separate body, grant-aided by the House. This would be similar, for example, to the Commonwealth Parliamentary Association UK. The National Security Adviser has written to the Clerk of the Parliaments and to the Clerk of the House of Commons setting out formally that this is the Government’s intention. My understanding is that the House of Commons Commission and the House of Lords House Committee are willing in principle to take on responsibility for grant-aiding the ISC. This solution meets the Government’s policy intention that responsibility for the ISC secretariat should be moved away from Government. As the ISC itself becomes a committee of Parliament so, subject to what I will say shortly, responsibility for the funding and resourcing of the ISC secretariat would pass from Government to Parliament.
Lord Butler of Brockwell
My Lords, in general, the amendments which the Minister has described are very welcome to the Intelligence and Security Committee. On behalf of the committee and my noble friend who is also a member of it, I thank the Government for the consideration they have given.
There are three issues that I should like briefly to put to the Minister. First, he said that in respect of access to operational information the committee will be given oversight of operational activity in three circumstances. In relation to the first, it is given retrospectively and if the matter is significant, and that is the usual type of operation that the committee currently considers. Secondly, as the Minister said, the ISC may also be given information about an operation if the Prime Minister wishes the committee to examine it. Therefore, current operations are not ruled out in those rather special circumstances. Thirdly, as the Minister said, the ISC may be given information about any operations if the agencies volunteer that information. There is a respect in which the word “voluntarily”, which appears in the Bill, can seem a little misleading and might even appear restrictive. At present, the agencies do indeed, of their own free will, confide frequently in the committee about operations, but “voluntarily” may suggest that this category is going to be restricted somewhat. I should be grateful if the Minister could give an assurance to the House, as he did when the Bill was before us previously, that there is no intention to restrict the current degree of information which the intelligence agencies give the committee about their operations.
The second issue is the question of resources. As the Minister said, it has been agreed that the ISC will become a grant-aided body. The assurances that I should like to ask the Minister, on behalf of the committee, to give are no doubt the assurances that he would expect me to ask him to give. The Government have repeatedly stated that they want to strengthen oversight. Does the Minister acknowledge on behalf of the Government that if oversight is to be strengthened the tools to carry it out will have to be provided? Can he give a commitment that the ISC will be given a substantial increase in resources that recognises this remit?
We have so far not reached agreement with the Government on what the grant is going to be. Those discussions are going on but it will have to be substantially higher than the present level of grant. Can the Minister confirm that the Government recognise that? Can he give some comfort to the committee that, although those negotiations have not been completed, the Government recognise that a substantial increase will be necessary?
The third point relates to the publication of classified information, to which the Minister also referred. Can he confirm that Schedule 1, which, quite rightly, puts safeguards on the committee’s power to publish classified or sensitive information, is not intended to prevent the ISC publishing other, non-classified material—for example, the issuing of press releases, open letters or newspaper articles, which the committee, or the chairman on its behalf, does from time to time?
If the Minister could give some assurances to the committee on those points, we would be very grateful.
Baroness Smith of Basildon
My Lords, I thank the Minister for his very detailed explanation of the amendments before us. In fact, he was able to talk about not just the amendments but some of the discussions that we had in Committee and on Report and about some of the background. I thought that at one point he might be challenging the noble Lord, Lord McNally, regarding his marathon speech during ping-pong of the Crime and Courts Bill, but fortunately he was not able to reach those dizzy heights.
I shall be fairly brief as I think that the Minister has covered many of the points and I suspect that your Lordships are more interested in some of the issues that we will be debating where there is not so much agreement as there is on these amendments. We welcome many of the amendments in this group. I am grateful to the Minister because the Government have obviously listened to many of the arguments made in Committee and on Report in your Lordships’ House and have brought forward amendments to recognise that.
As he will understand, I particularly welcome Amendments 32 to 37, which are identical to those that the Opposition introduced to place a power of veto on disclosure of information to the committee at the level of Secretary of State rather than Minister of State. I well remember the lengthy debates that we had in your Lordships’ House and I am glad that we were able to convince the Government that that was the right course of action. We are grateful.
I will raise one other issue in relation to the other amendments on which I should like the Minister to give me an assurance. In Committee and on Report, our position was that it was desirable for the committee to have full parliamentary privilege. At that time, we supported the view taken by my noble friend Lord Campbell-Savours that the only way to achieve that would be by establishing the ISC as a full Select Committee of Parliament, obviously with the additional safeguards necessary for a committee of that kind. That did not find favour with your Lordships’ House or with the Government. The view taken was that that was not the way to proceed as it was thought to be too difficult. Therefore, we welcome the steps that the Government have taken since that debate to provide greater protections in statute for the ISC along the lines of parliamentary privilege.
The Minister was very helpful in explaining Amendment 39, which grants witnesses, in relation to any evidence they give to the committee, statutory immunity from civil disciplinary proceedings and from criminal proceedings under certain circumstances where the disclosure has been made in good faith. That is hugely significant and we are grateful for that move forward. I am sure that the noble Lord remembers, as I do, the lengthy discussions that we had on this issue when the Bill was last before the House. However, is he able to provide greater clarity on the extent to which protection exists for other individuals involved in the proceedings of the ISC? If he does not have the answers today, I shall be happy for him to write to me. My understanding is that Members of Parliament are currently not protected by parliamentary privilege in relation to their work on the committee, and nor are the staff working on it in relation to the evidence held by the committee. Clearly, that is very important, as most of the evidence that the committee receives is likely to be covered by the Official Secrets Act as well as the Civil Service Code.
Can the Minister provide clarity on three further points? First, do the protections provided by Amendment 39 apply to witnesses who provide written evidence—for example, whistleblowers who provide evidence anonymously or in writing? Secondly, what protections are provided for the staff of the committee and the Members of Parliament serving on the committee? For example, if the ISC were passed anonymous information covered by the Official Secrets Act, would the ISC then be able to act on that information to investigate it or would the handling of the information cause its members and staff to be in breach of the Act? Finally, does the fact that these are statutory protections and not privilege mean that it would be possible for the Government or an employer to obtain an injunction preventing a witness appearing before the committee?
I do not raise those issues in any way as criticism. I repeat that we welcome the steps that the Government have taken towards the committee having greater parity with the powers and privileges of a full Select Committee. It would be helpful if the noble Lord could answer those points, although we broadly support the amendments and are grateful to him and to the Government for taking on board comments made by your Lordships and the Official Opposition in Committee and on Report.
Lord Taylor of Holbeach
My Lords, I thank the noble Lord, Lord Butler, and the noble Baroness, Lady Smith of Basildon, for their broad welcome for the amendments. This House has played a sizeable role in the process leading to the amendments. I do apologise. I was not deliberately seeking to delay the proceedings of the House but I felt it was important that I reported back as I see this as a significant change and one in which this House has played a key role.
The noble Lord, Lord Butler, asked about operational circumstances. I can provide the reassurance that there is no intention to restrict the ISC’s receipt of information on operational matters. The amendment makes it clear that information can be provided at the ISC’s request as well as by agencies or departments on their own initiative. I hope that reassures the noble Lord. He also referred to resources and asked for comfort. I am not sure that any Minister can give comfort on resources at the present time but perhaps I can say that the Government acknowledge that the ISC will require an increase in resources to reflect its expanded oversight role. However, as he rightly pointed out, negotiations are current. I would not want to comment further on those but I hope the noble Lord finds that that is of some comfort. It is certainly a recognition by the Government of the new role for the ISC.
The noble Lord also asked about restrictions on the ISC publishing material. It is not the intention to restrict the ISC from publishing non-sensitive and non-classified information in press releases or open letters. As I said, any information that could be in an ISC report can be published by it on an informal basis as well. I hope that gives a clear indication that things are not being made more restrictive.
I have a note here that might address the issues raised by the noble Baroness, Lady Smith—if I can read the detail. On the due protection supplied to witnesses providing written evidence, the answer is yes. On questions two and three about the handling of leaked information or an injunction preventing a witness appearing, it says here that I will write on those matters. I have to say that I hope I can write slightly more clearly than this note, which is meant to provide me with information. It does say that I will write. Given the nature of the questions, I think the noble Baroness will understand that it is important that I do not mislead the House by trying to ad hoc or wing it. I will happily write to her and place a copy of the letter in the Library. I beg to move.
Lord Taylor of Holbeach
That this House do agree with the Commons in their Amendments 2 and 3.
(a) the ISC and the Prime Minister are satisfied that the matter—
(i) is not part of any ongoing intelligence or security operation, and
(ii) is of significant national interest,
(b) the Prime Minister has asked the ISC to consider the matter, or
(c) the ISC’s consideration of the matter is limited to the consideration of information provided voluntarily to the ISC (whether or not in response to a request by the ISC) by—
(i) the Security Service,
(ii) the Secret Intelligence Service,
(iii) the Government Communications Headquarters, or
(iv) a government department.
(3A) The ISC’s consideration of a particular operational matter under subsection (3)(a) or (b) must, in the opinion of the ISC and the Prime Minister, be consistent with any principles set out in, or other provision made by, a memorandum of understanding.”
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendment 4.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I beg to move that this House do agree with the Commons in their Amendment 4 and in doing so, I shall also speak to the other amendments in this group. It is fair to say that the provisions dealing with closed material procedures have undergone significant changes since the Bill was first introduced into your Lordships’ House 10 months ago. This House made significant amendments to the Bill on important issues of principle. A number of noble Lords made their support for these provisions contingent on those changes being made. The Government have brought forward amendments that address the views of this House, and I believe that the measures in the Bill are proportionate and sensible.
In seeking to persuade your Lordships’ House that these amendments should allay the concerns expressed, we should remind ourselves briefly why the Government have brought the closed material procedure—CMP—provisions forward. Fundamentally, they will increase scrutiny of the intelligence and security agencies. CMPs will ensure that intelligence material which would risk the lives of agents and sources, or betray secret techniques is not revealed in open court. At present, the only method to protect very sensitive material such as the identity of informants from disclosure in open court is through public interest immunity. The problem is that a successful PII claim results in the exclusion of that material from the proceedings. Any judgment reached at the end of the case is not informed by that material, no matter how central or relevant it is to the issues in the case. This system works in some contexts, but when a case is so saturated in sensitive material the PII procedure can remove the evidence which one side needs to put their case. Settling is not always an option, and in serious cases involving accusations such as mistreatment, settling does not allow the court to get to the whole truth of what may or may not have happened. The other possibility is Carnduff-type strikeout, which also results in a case not being heard at all. We believe that CMPs offer a way through the dilemma. They enable the courts to ensure that allegations made against the Government are fully investigated and scrutinised, while addressing the potentially severe implications for national security.
A number of changes were made as the Bill proceeded through Committee and, principally, on Report in your Lordships’ House. There were six key amendments on Report, which it is fair to say were taken forward on the basis of a report from the Joint Committee on Human Rights. These increased the discretion available to the judge and allowed any party to apply for the CMP, and indeed for the court to order one, on its own motion.
Turning to the amendments, the Government have sought to take on board the concerns of the Joint Committee on Human Rights and amendments passed in your Lordships’ House. We have brought forward a completely restructured Clause 6—Amendments 4 to 15. There is also a proposed new clause, which is Amendment 16. It addresses the last resort concern by allowing the court to revoke a CMP declaration at any time. The Government’s proposals reflect the intention underlying the amendments made in this House, but also seek to avoid some unintended consequences that would cause problems in practice. Under these amendments the judge now has total discretion over whether to make a CMP declaration following an application by any party to the proceedings, or a Secretary of State, should the Secretary of State not be a party to the proceedings. The court also has the power to order a CMP declaration of its own motion. In making the case for CMPs, the Government argued that they can sometimes be fairer for claimants, too. The courts have confirmed that in some circumstances claimants’ cases will automatically fail without a CMP.
The Joint Committee on Human Rights, and this House observed and argued, rightly, that if CMPs are sometimes in the interests of claimants, they should be able to apply for them and the court should be able to order CMPs as well. These amendments make some technical changes to the amendments originally passed by your Lordships’ House, but they put all parties to proceedings on the same footing when it comes to making an application for a CMP declaration, and will allow the court to order one of its own motion. Where a non-government party is applying for a CMP declaration in relation to sensitive material they do not hold themselves, their interests will be represented by a special advocate in the closed part of the hearings determining that application. The Government have also fully accepted the amendment passed by this House that gave the judge discretion on whether there should be a CMP declaration. As I reflected in some conversations with my noble friends, many of us in our parliamentary lives have tabled amendments to change “must” to “may” or “may” to “must”. This House passed that this should be a change from “must” to “may”, which is possibly the most profound amendment that it made. It has some far-reaching consequences with regard to asserting judicial discretion. Previously, if the court was satisfied that there was relevant evidence that would damage the interests of national security were it to be disclosed, the court had no option but to make a declaration. Now the judge does have discretion.
Lord Beecham
My Lords, I wish to speak to Amendment 6A as an amendment to Amendment 6.
During the Second Reading debate on the Bill I referred to the obvious difficulty that your Lordships faced in calibrating the balance between the two desiderata of justice and security. There were some then, as there are now, who took the view that such an exercise was unnecessary, and indeed wrong in principle, and that the interests of justice must at all times and in all circumstances be paramount. On that basis, they urged that Part 2 of the Bill dealing with closed material procedures should be struck out. That was not the view of your Lordships’ House which, following the advice of the Joint Committee on Human Rights and the eloquent and forensic advocacy of the noble Lord, Lord Pannick, in particular, chose instead to amend the Bill and to circumscribe the application of a new procedure.
Those who would have wished to prevent any departure from the traditions of our system, which have long required that a party in a civil case should know the case he has to meet, must acknowledge that such a course is now no longer open to us. Our task, therefore, is to consider the Commons amendments and determine whether they have gone far enough in striking that delicate balance or whether, as I believe, further adjustments need to be made. I acknowledge and welcome the Government’s acceptance of some of the changes agreed by this House. In particular, as the Minister has pointed out, there is much more judicial involvement in the process than the Bill in its original form envisaged.
I also remind your Lordships of the serious implications for our system of justice of the Bill as it now stands and, to be frank, as it would stand even if, as I hope, we make further amendments and invite the House of Commons to think again about a small number of important issues. To a long line of pronouncements in this area by the most eminent judges we can now add the recent concerns expressed by the president of the Supreme Court, the noble and learned Lord, Lord Neuberger. Nor can we overlook the cavalier and, it might be thought, analogous approach of the Government to such different but cardinal areas as the deployment of emergency and retrospective legislation, demonstrated as recently as last Thursday and last night over the Jobseekers (Back to Work Schemes) Bill.
That is why we need to build on the progress made thus far in improving this Bill in three areas in particular. Two are embodied in amendments in this group in my name and that of the noble Lord, Lord Macdonald of River Glaven, dealing with what we may term, by way of shorthand, as the principles of last resort and judicial balancing respectively, reflecting the amendments moved so powerfully by the noble Lord, Lord Pannick, who would be moving them today had he been able to be present. The third area is that of a process for renewing the legislation after a period, to which we will come later. I propose to deal principally with the amendment in my name, but I whole heartedly endorse, and will say a word or two about, the amendment in the name of the noble Lord, Lord Macdonald. I am authorised by the noble Lord, Lord Pannick, to say that he entirely supports these amendments. His recent article in the Times makes his views clear.
The first amendment, Amendment 6A, effectively seeks to restore the position set out in the Bill which left this House, in making the use of closed material procedures a last resort. Amendments 16A, 16B and 16C import the same principle into the process for the court’s review of its decision contained in government Amendment 16. I consider these to be consequential upon this first amendment. I trust the House will forgive me if I remind noble Lords that closed material procedures allow the use of material not disclosed to the other party, who is therefore not able to give effective instructions, even to the highly security-vetted special advocate appointed to assist him. The amendment seeks to correct this by requiring the court to consider whether a fair determination of the proceedings is not possible by other means, such as some of the processes available under PII, the public interest immunity procedure. These include a range of options, such as the gisting of the case, redaction, the giving of evidence by security agents from behind a screen, and more besides.
In relation to PII, it is interesting to note that the Government appear to be taking a somewhat inconsistent approach. Inquest proceedings, after all, will not be covered by the provisions of the Bill. The Government have constantly represented PII as a lengthy process which leaves them in a position where they might feel compelled to choose to settle a case rather than disclose information. Sweeping, if unsubstantiated, claims have been made about millions of pounds having been paid, or potentially having to be paid, to unidentified numbers of unidentified terrorists, to be used for unidentified purposes. Perhaps the noble and learned Lord could enlighten us as to the number of claimants who have received compensation, and who have been charged with any offence, been made subject to a control order or similar constraint, or had their compensation frozen—as it could be—on the grounds that it might be used for terrorist purposes. After all, the Minister without Portfolio, Mr Clarke, said:
“We expect only a handful of cases”.—[Official Report, Commons, 04/03/2013; col. 705.]
The notion that there is a great tidal wave of cases waiting to sweep over us and our system, involving vast expenditures, seems to have been exaggerated, to put it mildly, in the light of the Minister’s remarks just a week or two ago.
As the noble Lord, Lord Pannick, pointed out in his article, under the PII procedure, the courts are,
“able to reconcile justice and security by taking steps”,
such as those to which I have referred. He went on:
“Only if those methods cannot protect security, and allow for an open assessment or at least a gist of the case against the claimant, should the court consider moving into a closed session”.
He went on to dismiss the Government’s contradictory responses, namely that judges would adopt that approach in any event, and that such a safeguard would be too time-consuming. He also went on to rebut the Government’s counterargument against balancing the interests of national security against the public interest in the fair and open administration of justice, pointing out that this is exactly what the PII procedure involves. He is of course, as the noble and learned Lord has pointed out, not the only Member of your Lordships’ House to have contributed to the columns of the Times on these issues. His article may be seen in part as a reply to a letter from the noble and learned Lord, Lord Woolf, expressing approval of the amended Bill’s provisions in relation to CMPs, to which he has referred at some length.
It is with more than usual trepidation that I join the noble Lord, Lord Pannick, special advocates, the Joint Committee on Human Rights and the Equality and Human Rights Commission in respectfully dissenting from the conclusions of the noble and learned Lord, Lord Woolf. These, while properly welcoming the positive responses by the Government to amendments carried by this House, for which the noble and learned Lord voted, effectively endorse their position on the issues of last resort and balancing. The noble and learned Lord referred in his letter, not unreasonably, to the fact that in a minority of cases, and I use the same quotation as the noble and learned Lord:
“The interests of justice are not served when courts are blindfolded”.
The consequences of closed material procedures are that claimants are both blindfolded and effectively gagged, even in cases of habeas corpus. The Minister without Portfolio has, after some initial confusion about the matter, conceded that the Bill would apply to this, one of the most fundamental parts of our English common law. It is not unreasonable therefore to require the court to determine that the case cannot fairly be decided by any other means, rather than it having merely to be satisfied that the Secretary has, in the words of proposed new subsection (1F),
“considered whether to make, or advise another person to make, a claim for public interest immunity”.
That sets a very low bar for the Secretary of State to surmount. He has only to have considered it. Concern about the Government’s overall position can only be enhanced, despite their bland assurances, by the form of words set out in proposed new subsection (1D) in Amendment 6, which makes two substantial changes to the amendment carried here on the recommendation of the Joint Committee on Human Rights. Members may recall that Clause 6(2) of the Bill which left us stipulated that the court may make a declaration allowing CMP if, were the material to be disclosed, the degree of harm to the interests of national security would be likely to,
“outweigh the public interest in the fair and open administration of justice”.
Under Amendment 6, proposed new subsection (1D) changes this to impose the condition that,
“it is in the interests of the fair and effective administration of justice in the proceedings to make a declaration”.
Openness is therefore replaced by effectiveness, a very different concept. Effective, one might ask, from whose perspective? Is it that of the party, presumably the Government? Openness now counts for nothing. The phrase “in the proceedings” is added, excluding the wider considerations of the public interest. The concept of balancing the two interests disappears. This applies also to Amendment 16, on which the noble and learned Lord seeks to rely.
The Minister without Portfolio likes to paint with a broad brush. He claims that the effect of these amendments would require the Secretary of State and the court to go through all the documents before an application for a CMP is made. They would not. As the special advocates point out, disclosure under present statutory CMPs is no less time-consuming than PIIs. Once having examined the documents, the court could consider whether PII could lead to a fair trial without having to undergo a full PII exercise. The Secretary of State has only to consider whether a PII claim could have been made. He is not under an obligation to go through every document.
Mr Clarke’s adherence to liberal principles over the years has earned him many admirers in a lifetime in politics, although not necessarily within his own party. I hope that, by endorsing these amendments, the House can not only help to minimise the damage threatened to the most valued elements of our jurisprudence and judicial system, but help rescue the Minister without Portfolio from self-inflicted damage on his reputation for upholding those liberal values, as he comes to the end of his most distinguished career. In the name of our cherished traditions of fair and open justice, I invite your Lordships’ House to support the amendments.
Lord Macdonald of River Glaven
My Lords, I speak to Amendment 6B in my name. Everyone accepts that CMPs represent a significant departure from normal rule of law principles. Many people accept that they also contain a strong strand of unfairness, and that this unfairness consists in the exclusion of one of the parties from a critical part of the proceedings, perhaps even that very part of the case in which the defining issue is decided. Therefore, the claimant can never know the evidence that has damned his cause—it is never revealed to him.
Let us be blunt about this. The party withholding the material, and gifting it to the judge in secret, will almost always be the Government. The illiberalism inherent in the Bill seems to me to lie in this. CMPs as presently constituted are not fair, because they do not and cannot deliver balanced justice between the citizen and the state. This is the finding of the JCHR; it is the finding of those eminent lawyers appointed by the Government to conduct closed proceedings, the special advocates; and it was the overwhelming conclusion of this House when last we debated these measures. It is no doubt in recognition of this central unfairness that the Government insist, and the Secretary of State has repeatedly insisted, that it is their fervent desire that CMPs should only ever be used as a last resort.
Lord Lloyd of Berwick
My Lords, I shall confine what I have to say to Amendment 6B, now that it has been spoken to by the noble Lord, Lord Macdonald of River Glaven. I am of course conscious that when this amendment was moved by the noble Lord, Lord Pannick, on Report, it was carried by a very large majority, but I voted against it at the time and do not support it now, for two reasons.
First, I like the wording of the Commons amendment. It seems to me to fit the bill. In particular, I support the inclusion of the word “effective”—as well as the word “fair”—in the phrase,
“fair and effective administration of justice”.
For the same reason, I will not be able to support Amendments 16A, 16B and 16C, tabled by the noble Lord, Lord Beecham, which would remove that very word, which seems so important. In my view, “effective” is the key word, le mot juste, in this context. It sums up in one word the whole need for and purpose of the closed material procedure.
A system of justice is surely ineffective if one party to the proceedings, whether claimant or defendant—I am glad that it now includes claimants—cannot put forward his case, or his whole case, without the need to disclose sensitive material. The purpose of the Bill is to cure that defect. That is why I support the second condition, as set out in proposed new Section 1D of the Commons amendment, and find that I cannot support the amendment of the noble Lord, Lord Macdonald. The word effective, particularly coupled with the word fair, provides the judge, who has to make those decisions, with all the help that he will need. For that reason I do not support the noble Lord’s amendment.
There is another reason why I cannot support the amendment, which was the reason I voted against it when it was moved on Report by the noble Lord, Lord Pannick. The wording of the amendment is said to come from a case called Wiley, which was decided so long ago that I had forgotten that I was a party to the decision. I find that I was, together with my noble and learned friend Lord Woolf. The difference between us was that my noble and learned friend gave a very long speech. He was followed by me, who agreed with everything that he had said—in a very short speech. I hardly need say that counsel was the noble Lord, Lord Pannick.
The case has long since been superseded; indeed, I cannot find it in any current textbook. However, looking at it again this afternoon, I could not find anything that supports wording quite as wide as that proposed in the amendment. In any event, the Wiley balance was useful, as I remember it, and as the noble Lord has explained, in applications for public interest immunity, where the judge had to weigh the harm done to the public interest by admitting a particular document or documents against the harm done to a particular defendant or party in the case by excluding those documents.
That was always a difficult balancing act, but it was possible because it was a specific test which he had to apply. As I said, it served a useful purpose. I cannot regard it as a useful test in this context. How is the judge to evaluate the public interest in the,
“fair and effective administration of justice”?
That is far too wide and imprecise to be of any utility, certainly in the context of deciding whether to make a declaration under Clause 6. It gives the judge no help at all in making that decision. For that reason, too, I cannot support the amendment.
Baroness Ramsay of Cartvale
My Lords, I will address Amendments 6A and 6B and the consequential Amendments 16A, 16B and 16C. I will not repeat all the arguments made by the Minister, but I agree with them. Like the noble and learned Lord, Lord Lloyd of Berwick, I cannot accept Amendment 6A or Amendment 6B. As a non-lawyer, when I read Amendment 6A I interpreted it exactly as the Minister feared the court would be forced to interpret it: that it would have to try every other possible method before it came to the CMP.
I hope that the noble Lord, Lord Macdonald of River Glaven, will forgive me for saying that when I read Amendment 6B I wondered if he meant it to be a wrecking amendment. When I heard him explain it he seemed to confirm that suspicion. He is arguing against the whole concept of CMP. Why are we here? We are not here because we want to go into this kind of judicial arrangement but because we have got a big problem on our hands. The previous Government had it and this Government have now got it. People are going into the civil courts and suing officers of the intelligence and security services, accusing them—rightly or wrongly—of doing terrible things such as being implicitly involved in torture and extradition. The services cannot defend themselves because they cannot put material into a court.
There has to be a solution and the solution is not PII, as some people seem to think. I would also like to quote the noble and learned Lord, Lord Woolf—if he will forgive me because he is in his place—not from the excellent letter quoted by the Minister, but from what he said in a debate on this issue in this House on 11 July last year. He said:
“I should also make it clear that I think that the noble Lord, Lord Carlile”—
who had just spoken ahead of him—
“is right in saying that in most situations that are covered by the Bill the result will be preferable to both sides”—
both sides—
“if the closed hearing procedure is adopted rather than PII, because PII has the very unfortunate effect that you cannot rely on the material that is in issue, whereas both the claimant and the Government may want to rely on that material. That is a good reason for having the closed-hearing procedure”.—[Official Report, 11/07/12; col. 1189]
I very much agree with that.
The amendments that I have mentioned do not improve the Bill in any way. In fact, they are to the detriment of the Bill. This is a problem which the previous Government had to wrestle with, the present Government are having to wrestle with and the House has to wrestle with it. Now that they have included the latest Commons amendment, the Government have made a very good attempt at trying to square what we all want, which is a fair trial. That must include, in the civil court, members of the security and intelligence services so they can bring a defence to accusations against them.
Lord Brown of Eaton-under-Heywood
My Lords, in rising to support this Bill I confess to a particular interest in the legislation. Many years ago—although not quite as long ago as the noble and learned Lord, Lord Woolf—as Treasury Counsel I was required to advise and act for the Government in national security, public interest immunity cases. For six years after the passage of the Regulation of Investigatory Powers Act 2000, I was the Intelligence Services Commissioner responsible for retrospective judicial oversight over the various intelligence agencies. For considerably more years than that, I have been involved, as a member of the court, in most of the national security cases that came before us, including the control order cases and the expulsion cases like that which sought to return Abu Qatada to Jordan, on which the litigation still continues. The Al Rawi case relating to Guantanamo Bay, although it was settled before it came to us, came on the issue of principle which was whether, as a matter of common law, the courts could order a closed material procedure. The majority of us held not. We held that only Parliament could sanction so fundamental a departure from the principle of open justice. Hence Clause 6 is now before us.
Lord Goldsmith
My Lords, it is too late in this process to take the view that closed material procedures can never take place. I have grave doubts about this. It was something that we considered when I was in government, when we had to deal with special procedures in relation to control orders and where people’s liberty was at stake. This is a different order, which is to do ultimately with money. Be that as it may, we are past that point. The question we must ask is: under what circumstances should they exist? Both these amendments, which I support, although not quite in the terms in which Amendment 6B was put forward by the noble Lord, Lord Macdonald of River Glaven, are important, as the noble and learned Lord, Lord Brown of Eaton-under-Heywood, has just explained. I want to focus particularly on Amendment 6A.
Amendment 6A requires that the court should be satisfied that a fair determination of the proceedings is not possible by any other means. I thought that was something which this House had now accepted as an absolutely fundamental condition. It may be that CMP had to happen sometimes—many of us do not like the idea that it happens at all—but if it does, it is because that is the only fair way of determining it. Why is that resisted? As I understood it from the Minister, it is thought that somehow that condition is met by new subsection (1F) in Amendment 6. That says:
“The court must not consider an application by the Secretary of State under subsection (1A)(a) unless it is satisfied that the Secretary of State has, before making the application, considered whether to make, or advise another person to make, a claim for public interest immunity ”.
My noble friend Lord Beecham said that that is a very low bar. It is an extremely low bar and it is very important to recognise that.
This does not begin to approach the question of a determination by the court—the judge—as to whether this is the only fair way of determining the issue. All he has to do is to decide that the Secretary of State has considered whether a PII application should be made. That determination will take 30 seconds. Counsel appearing for the Secretary of State will say, “The Secretary of State has considered it”. There is no going behind that and, indeed, it will be true. The Secretary of State will have considered it. He may have rejected it on the grounds that he has very carefully considered it and decided that it was all too difficult, or simply because he thinks it would be expensive, which was part of the point made by the Minister, or just that he does not like the idea of doing it because he really wants a CMP to be made. That is no safeguard at all. If any noble Lord thinks it amounts to some equivalent of a determination by the court and that the court’s view is that no other way can be found of fairly determining the case, he would be quite wrong.
Why, then, would this amendment tabled by my noble friend Lord Beecham be rejected? It states:
“If the court considers that a fair determination … is not possible by any other means”.
There are only two possible reasons for rejecting the amendment. One is that we would actually like to see CMPs even if there is another way of determining the proceedings and so the fair determination of proceedings would not only be by CMP. It would be a very retrograde step to accept that. It would absolutely be the message that the noble and learned Lord, Lord Brown, has indicated that we must not send. The other reason would be that we do not trust judges to make that determination. I very much hope that this House will not for one moment countenance the proposition that when it comes to deciding whether a case can be fairly determined we would not trust the decision of our courts. I will warmly support my noble friend if he divides the House. I will support Amendment 6B but it is Amendment 6A that I have particularly spoken to.
Lord Butler of Brockwell
Before the noble and learned Lord sits down, perhaps I may ask a layman’s question. It may be an oversimplified one. The essential condition the court has to be satisfied with is not, principally, whether the Secretary of State has considered PII—that is certainly one of the conditions—but that it is in the interests of the fair and effective administration of justice in the proceedings to make such a declaration. Is that not the principal test and what all this is about?
Lord Goldsmith
The principal test should be whether the only fair way of determining the matter is through a CMP. That is a very simple statement. It is a very simple test but for some reason the Government do not want to accept that as the test that should be applied.
Baroness Berridge
My Lords, I rise to speak briefly to Amendments 6A and 6B in this group and I am privileged to serve as a member of the Joint Committee on Human Rights. As the committee has been considering this matter since the Green Paper, I am probably as familiar with it as my noble and learned friend Lord Wallace.
The language of last resort that has now been adopted in Amendment 6A is quite suitable. The words,
“is not possible by any other means”,
reflect the recent statement of the noble and learned Lord, Lord Neuberger, in Bank of Mellat v HM Treasury in the Supreme Court when the Supreme Court allowed consideration of a closed judgment in a closed material procedure. He stated that,
“this is a course which is to be taken only where the court is satisfied that it is absolutely necessary to dispose of the appeal justly”.
I reiterate the point that, although I share the concerns of the noble Baroness, Lady Ramsay, about the reputation of those who serve in our security services, this Bill will affect the reputation of the judiciary and, as my noble and learned friend Lord Wallace has outlined, these cases are ones saturated in this type of sensitive material. It is a matter of logic that a judgment in a case that is so saturated runs the risk of being almost completely blank and we face the situation where claimants will appear on the sofas of our breakfast television programmes with judgments from our courts that literally are blank.
This concerns not just the cases of the Guantanamo Bay claimants—I am proud to live in a country where citizens can go to our courts and sue members of our security services. The claimants may also include other people. I have mentioned previously the family of Gareth Williams. We know that his unfortunate death is currently under investigation but often if a prosecution is not brought the family will bring civil proceedings. We are talking about a situation where the parents of someone like Gareth Williams will be excluded from our courtrooms.
It is also most worrying that Her Majesty’s Government have not won the support of the special advocates as to the merit of these closed material proceedings. I speak as a former lawyer. They will gain work if there are more closed material procedures but we have not won their support. In fact, it is their complaint, long-standing according to the recent evidence of Mr David Anderson QC to the Joint Committee, that in SIAC and other jurisdictions there is “occasional overuse of CMP”. In addition, SIAC exceptionalism has not been maintained and CMPs have crept into other jurisdictions. I believe that this amendment guards against that kind of creep in civil forums. The amendment is also worded in a fashion that does not require a full PII process to be gone through before our extremely experienced High Court judges can determine “any other means”.
Why it should be,
“not possible by any other means”,
is also because, arguably, any other means is better than a CMP. I note here what my noble and learned friend Lord Wallace outlined about obtaining the whole truth. It is common that there are serious doubts here as to whether the whole truth will always be obtained when one party to the proceedings is not in the courtroom. I say “arguably” as we have never received figures, although we have requested them, for PII on the grounds of national security that leads to the total exclusion of the evidence produced by the Government. I have never been convinced of the Government’s position that expelling one party to the proceedings and running the risk of evidence not being challenged is better justice than excluding some evidence, not a party, from the hearing, however relevant the evidence is. It is better for the Government but not for justice.
I do not wish to appear glib as I accept that there are serious matters to be considered such as the security of our intelligence sources, their reputation, the reputation of the judiciary, the reputation of justice and the fact that these cases arise where there are serious human rights abuses. However, I find it odd that since your Lordships’ House last considered this Bill Her Majesty’s Government settled a claim by Mr al-Saadi for £2.2 million after he said that the UK was involved in his unlawful rendition to Libya. Why did the Government not wait for the legislation so that they could have a CMP? It leads me to wonder that it is not every case that the Government cannot defend because they do not have access to a CMP and so pay out taxpayers’ money with the security services taking a reputational hit. I happen to think that, in the minds of the great British public, if there is such a reputational hit, it is far outweighed by the kudos of the James Bond brand.
Amendment 6B appeals to the need to take into account the public interest in the fair and open administration of justice. Right from the beginning of this process with the Green Paper, there has been scant, if any, recognition by the Government of the principle of open justice. Perhaps it is because, unlike in the time of Charles Dickens where open justice meant that trials were public entertainment, open justice today is ordinarily journalists being the eyes and ears of the public. The attitude of many to journalists due to phone hacking should not taint the public view of journalists such as Joshua Rozenberg and Gordon Corera who report inquests and matters in this area of law. That is a vital public function.
The test as the Bill currently stands is,
“in the interests of the fair and effective administration of justice in the proceedings to make a declaration”,
and it is not sufficient as quite simply this is not a balancing test, Wiley or otherwise. It is not a balancing of interests. It says you merely put this on one side of the pan of the scales and regardless of what is weighing on the other side it goes into a secret procedure. Not all that would ordinarily be in the Wiley balancing test will, in my view, be included in the test in the Bill. As this is such an irregular trial procedure to adopt, it should be a competition of interests, a battle even for the Government to show that national security outweighs fair and open justice and that the nature of these proceedings is so unusual and so contrary to our principles of a fair trial that it should be only when nothing else is possible.
To conclude, I can do no better than to refer to the statement of the noble and learned Lord, Lord Neuberger:
“It must be emphasised that this is a decision—
to go into a closed material procedure—
“which is reached with great reluctance by all members of the court; indeed it is a majority decision. No judge can face with equanimity the prospect of a hearing, or any part of a hearing, which is not only in private, but involves one of the parties not being present or represented at the hearing”.
This is an unhappy procedure—again, to borrow the language of the noble and learned Lord, Lord Neuberger—and, as such, judgments are secret for 30 years. That was clarified to the Joint Committee. I sincerely hope that I am wrong that the Lord Hennessy of the future will have an annual TV slot at the turn of the new year at the National Archives in Kew uncovering judgments that, had they been open, would have been appealed and the government of that day, again, pay out millions of pounds in compensation, and not even “Skyfall”, which I believe is currently keeping Peers occupied in Committee Room 2, would save the reputation of MI5, MI6 and our judiciary.
Lord Owen
My Lords, as a former Minister with responsibility for MI6 I realise that although it has a need to have and an interest in having its views expressed—and that was done very well by the noble Baroness, Lady Ramsay—there is also a prior consideration, and that is to write on to the face of the Bill that we have almost unanimously agreed that this closed procedure can be done only in a tiny minority of cases, or, as other spokesmen have said, only as a wholly exceptional device. I can see no objection whatever to the wording of the amendment of the noble Lord, Lord Beecham, and I profoundly hope that it is agreed to.
The other amendment, proposed by the noble Lord, Lord Macdonald, raises very serious questions about whether we would see this new procedure, which I now think is necessary, in operation. I agree with everything that the noble and learned Lord, Lord Lloyd, said about that and I do not need to repeat his arguments. I think that some would regard the amendment as a blocking mechanism, although I am sure that it was not proposed in that way; I am sure that it was proposed as a double safeguard. However, it would not deal with the issue that, above all, has concerned me: how you protect source material, particularly if it comes through the intelligence of another country. We cannot imagine that a totally rational debate will always take place in a law court. This is an issue of whether you are supplied with that information. If there are profound doubts about the procedures—right or wrong—and if they are held by countries which have been our intelligence partners over many decades and whose information has sometimes saved a considerable number of lives in this country, we have to take account of how they see that procedure. Were the amendment of the noble Lord, Lord Macdonald, to be passed, we might find that other countries would not see the procedure as safe. I would therefore stick to the Government’s amendment and their wording and not go along with the amendment of the noble Lord, Lord Macdonald.
Baroness Kennedy of The Shaws
My Lords, I support Amendments 6A and 6B. I think that there is agreement in the House that CMP should be used only in the most exceptional circumstances and that it so radically departs from one of the most fundamental of our common law principles that it is essential that its use is kept to a minimum.
I endorse what the noble and learned Lord, Lord Brown, said about the process that happens in a court. All this sometimes seems arcane or obscure to those who are not lawyers and it is easier to pin it down by having examples. Those of us who practise in the courts and often deal with security matters know that the process described by the noble and learned Lord, Lord Brown—where a judge will consider whether you can redact documents and take out references or anything else that might in any way disclose the identity of an informant—takes place in these cases and has done over the years. There is the business of someone giving evidence with their identity never being disclosed, or giving it from behind a screen, and there are other ways of doing it using new technology. There are many mechanisms, quite different from the PII process, which can protect the things that the security services are sensitive to, and it can be done with agreement while retaining the sense of as much openness as possible.
My sense of what the House wants here is for the closed material procedure of barring the defendant and their lawyers from the court and from hearing the evidence—which is fundamentally unfair and flies in the face of the idea of a fair trial—to happen in the most exceptional circumstances. It therefore seems extraordinary that there should be resistance to the notion that the Bill should state that such a process should be used only as a last resort. The argument made for not doing so is that it would be time-consuming for the Secretary of State—because the Secretary of State, even in this minute number of cases, would have to look through the papers and acquaint him or herself with the detail—as well as for the court. As your Lordships have heard from others who, like me, have participated in proceedings of this kind, one would expect a Secretary of State or a judge in a case of this kind to consider with care the nature of the evidence and whether it was possible to keep it as open as possible. That is what we would expect, and it is certainly what I would expect of a Minister who was exercising authority. Otherwise we would ask, “If the Minister does not want to examine the evidence that is being kept secret, who is exercising the authority? Is it the Minister or is it the security services?”. We really have to be very careful here. I remind the House of what happened in Matrix Churchill, where we understood that there was just a signing-off of requests by the security services, which was of great discredit to government at the time. I would warn against what this procedure will do to confidence in government, confidence in the security services and confidence in our judicial processes.
Lord Mackay of Clashfern
My Lords, I suppose that I can claim to have had some experience in dealing with this area of the law in the past. The first thing I want to say is that the procedure that has hitherto been adopted in relation to national security is a secret procedure in which the judge sees the documents and the other side does not. This secret procedure has been established and used many times, as the noble and learned Lord, Lord Brown, has said. There is nothing novel about that kind of thing having to happen in relation to sensitive material.
The first condition for the closed procedure is that one of the parties will be required to produce sensitive material—that is to say, material which is damaging to national security. The noble and learned Lord, Lord Brown, has said that he was considering redaction as an alternative to CMP, and using screens to hide people’s identity. That must be considered before you can say that sensitive material has to be produced. The idea of that is to remove the sensitivity of the material and make the redacted material harmless to national security.
It seems to me that the only alternative that this first amendment would introduce is the amendment of public interest immunity. As the noble and learned Lord, Lord Brown, has explained in the case to which he referred, attempting to ascertain that would require, in some cases, a very long process. The process is equally one in which one of the parties is not allowed to take part. It is not much of an advantage over this procedure.
Lord Goldsmith
My Lords, the noble and learned Lord, Lord Mackay of Clashfern, has made that point twice. Does he recognise that although, as he said at the outset, there have been procedures in which material has been seen, but not by one party, those are not procedures in which that material is then relied upon by the judge to determine the rights and wrongs applicable to that party? This is in order to exclude that material and not to allow it in. Is that not the novelty of this procedure?
Lord Mackay of Clashfern
Absolutely, that is the procedure with excluded material. Of course, excluding the material can sometimes be extremely damaging to the interests of the other party to the litigation. The noble Baroness referred to Matrix Churchill. That was exactly the sort of case that Matrix Churchill would have been if the judge had excluded it because the material that was sought to be excluded as sensitive material was, on further examination, of great use to the claimant, as we all know. The idea that a public interest immunity certificate is so superior to this procedure strikes me as being without great foundation.
I assume that the only material in question is material that has been subject to all the processes that the noble and learned Lord, Lord Brown, has suggested for removing its sensitivity, because if you can do that the party is not required to produce sensitive material because it has been neutralised and the difficulty has been removed. Therefore, when you have that in mind, it is very hard to see how you can find out whether there is any other way in which the case can be dealt with. One of the problems about that is that at the beginning of a case things may look different from how they look as the case proceeds.
One of the great benefits of the amendments that the other place has put in here is that this matter can be reviewed at any stage of the procedure. Therefore, it seems to me that this system, in a very small minority of cases, will be the best way of securing the fair and effective administration of justice in that case. It is not a question of excluding material, which is an appropriate test for the amendment proposed by the noble Lord, Lord Macdonald; it is nothing to do with that. It is to see that the material that is being used is used in a way that does not damage the security of this nation. The Government have as one of their primary responsibilities securing the national security, as evidenced by what the noble and learned Lord, Lord Woolf, said about control orders, which control people’s liberties, in which this sort of procedure was introduced. I believe that this procedure is the best way in which to secure national security.
I endorse what the noble and learned Lord, Lord Woolf, said in his letter. Our judges are as familiar with the desirability of open justice as any Peer who has spoken. They know the value of open justice; they were brought up to it. There is no question of a judge going for a closed material procedure if he thought it could be done in open court. I believe that giving this discretion to the judiciary in very limited circumstances with two very important conditions is the right way to deal with it. It is not the Executive who are deciding, but the judge. Judges have taken an oath to,
“do right to all manner of people … without fear or favour, affection or ill will”.
That oath will apply in the decision that the judge has to make, and it seems to me that the best possible test has been evolved by the House of Commons in its consideration of our Bill, and the test is the fair and effective administration of justice in that case.
Lord Thomas of Gresford
My Lords, much of what I intended to say has already been said, but I shall give an illustration from the classic case of Duncan v Cammell Laird, which involved the sinking of a submarine in Liverpool Bay while undergoing trials on its maiden voyage in 1939. Ninety-nine men were lost. Their widows, mostly from Merseyside, sued the shipbuilders. The Admiralty, in the middle of the Second World War, declined to allow the production of the designs of the submarine on grounds of national security. Contemporary evidence, which has been seen since, suggests that its true motive was to restrict the power of citizens to sue government departments, particularly when they were financed by trade unions. In fact, the claimants lost.
Today, other means, which have been referred to in the course of this debate, might have been used to assist those claimants in the projection of their cases, but suppose this legalisation had been in force and that the Government had applied for a secret hearing. Can your Lordships imagine the uproar in Liverpool if the Admiralty had been able to produce not merely the designs but its expert evidence and argument, and to explain those designs to the judge in secret, without challenge and without anything being heard on the other side? Patently, it would have been a miscarriage of justice.
Open justice, very simply, means first that a claimant should know the case made against him. That principle derives from what was said more than two and a half millennia ago by Aeschylus in the “Oresteia”.
Lord Mackay of Clashfern
How does my noble friend know what the judge would have decided, assuming that he had had a chance to look at the designs?
Lord Thomas of Gresford
I am not saying what decision he would have made—how could I possibly know? I am saying that the public would have been outraged at the idea that the Admiralty could go to see the judge up the back stairs, in a secret court, and produce the designs and the arguments to support their case.
Baroness Butler-Sloss
Perhaps I may say, as a court judge, that nobody would ever visit a judge up the back stairs when a judge was trying a case.
Lord Thomas of Gresford
I have certainly been up the front stairs to see many a judge in chambers. The noble and learned Baroness must know that we see the judge in private on many occasions, particularly when public interest immunity claims are being used.
The second principle of open justice is that the acts of public servants must be open to scrutiny and accountability by the public and by Parliament. It is for the judge to determine whether, as a last resort, open justice must give way to national security in the circumstances of the particular case. Everybody who has spoken here this evening has said that judges are perfectly capable of making that judgment, of carrying out that balancing exercise. However, that does not mean that secrets will be disclosed. We are talking about civil cases, about means whereby secret information will be withheld, and many mechanisms for achieving that have been referred to.
I draw your Lordships’ attention to a civil case last December which challenged the Defence Secretary’s practice of handing over detainees who had been captured in Afghanistan to the Afghan security forces. There was evidence to suggest that torture would be inflicted upon those people by those forces. The case came to court and the Defence Secretary claimed public interest immunity for a number of documents. Lord Justice Moses held that there was no objection in principle to the disclosure of material that was the subject of that claim into a lawyer-only confidentiality ring. That procedure is well known in the commercial courts of this country, and I believe that it is used in the United States of America. Is it not interesting that, while we are changing our law, we have not heard any suggestion from the United States, which is faced by the problems with which we are grappling, that it proposes to change its law or constitution in any way at all?
As I have said, these principles are core principles of liberalism and democracy, and I hope that your Lordships will support these amendments in the light of these principles.
Lord Woolf
My Lords, I propose to say only very little because to some extent I anticipated what I might say, both in the previous debates on this matter and in the letter that has been referred to. However, when you hear Members of this House, with the experience that they undoubtedly possess, expressing concerns on this subject in relation to this Bill, I say that we have to give those concerns the utmost care and consideration, because their importance is very great indeed. We must be very careful that we do not fall into the trap of changing our traditions when that change will cause more harm than good.
Despite the arguments that have been advanced to the contrary, I remain firmly convinced that the Bill that we are now considering is radically better than the one that we were considering before, and the Government must be entitled to credit for that. As I understand it, what we really are considering, despite the oratory that we have heard, is very much a matter of degree. The only question to consider now is whether two further precautions should be inserted into the Bill in respect of what the Government have already done, which is to be welcomed on all sides.
Of course I accept the importance of open justice. You do not need to have that set out in a Bill for judges or ex-judges to say it. We have heard clear evidence of that in a recent decision of our Supreme Court, where the president of the Supreme Court was dealing with a procedure that is akin to the procedure now being proposed. The president of the Supreme Court, the noble and learned Lord, Lord Neuberger, made the clarion call—and I am delighted that he made the statement—that all should recognise that we are dealing with a situation that involves an intrusion into the principle of open justice. If there was any doubt about the ability of judges to protect that principle, I suggest that the noble and learned Lord, Lord Neuberger, made it clear that judges will protect it. After all, a judge makes a judgment, but his judgment is then subject to appeal. I urge the House to conclude that what we want is a situation where the judiciary, which has the fundamental responsibility of doing justice, has a discretion that is wide enough to do justice in the particular case that comes before it. I suggest that this Bill, without the proposed amendments, has to be judged on whether it enables the judge to do that.
The noble Baroness, Lady Berridge, suggested that this Bill might enable judges to do things that would reflect adversely on them. I accept that that is the inevitable consequence of judges exercising their responsibility to protect national security. If giving a judgment that is right and in the interests of effective and fair justice will reflect adversely on a judge, he or she must do their duty, give that judgment and not be concerned by the reputational consequence for them of giving that judgment. It is my belief that that is just what our judges do. They would put that out of their minds. Those are political considerations, which they should not be concerned with.
What is being done here is something that the Government say will contribute to justice, not the other way round. It is being done because, as must be recognised, it is the only real alternative that the judges do not already have. With great respect to the noble and learned Lord, Lord Goldsmith, I found his submissions difficult to follow, because redaction does not need this Bill; it is something that judges use regularly. The judge’s ability to take sensible precautions to protect national security is used with a degree of frequency, but this Bill does not affect those cases. It affects only those cases when the judge is satisfied that better justice will be done because of the Bill than would be done without the Bill. The amendments are to be criticised for the reasons identified by the Minister in opening the debate. It is right that you cannot have the judge using what is proposed here as a last resort, because that would undermine the Bill’s purpose.
Does the Bill give the judge the discretion that he or she needs? I remind noble Lords of the terms of Clause 6(2), which says:
“The court must keep the declaration under review, and may at any time revoke it if it considers that the declaration is no longer in the interests of the fair and effective administration of justice in the proceedings”.
Those are very wide terms, which give the judge what he needs. Clause 6(3) provides:
“The court must undertake a formal review of the declaration once the pre-trial disclosure exercise in the proceedings has been completed, and must revoke it if it considers that the declaration is no longer in the interests of the fair and effective administration of justice in the proceedings”.
Those provisions put the judge in the driving seat, which is exactly where the judge should be as a result of this Bill.
Although we have to examine the arguments to the contrary with great care and appreciate just how important are the principles at stake, we should come to the conclusion that this is a Bill of which we can now approve.
Baroness Hamwee
I ask my noble and learned friend two short questions. The first is a very simple one, possibly even simplistic. He referred to the change in terminology from “must” to “may” as being very profound. Could he confirm to the House that the Commons amendment providing that the court,
“may make such a declaration”,
if it considers that two conditions are met, is equivalent in non-legislative speak to saying that the court may not make a declaration unless the conditions are met? In other words, it may make a declaration only if those conditions are met.
My second question concerns a matter that has been referred to once very quickly—that is, gisting, or the disclosure to an excluded party of sufficient material to enable him to give effective instructions to the special advocate representing his interests in closed hearings. Clause 10, which is to be amended by Amendment 17, is about the rules of court, and I would like to ask my noble and learned friend about those. There is nothing returned from the Commons on which we can hang an amendment specifically about gisting, so I hope the Minister can reassure us from the Dispatch Box that the rules will provide what I hope they will in this connection. Under Clause 10(2)(g), rules may enable the court to give a party to the proceedings a summary of evidence taken in that party’s absence. Responding to the first report from the Joint Committee on Human Rights, the Government say:
“Wherever it is possible and practically feasible to provide gists and summaries of national security sensitive material without causing damage, they will be supplied”.
They add that the question of gisting should be decided on a case-by-case basis. I do not want to take up the time of the House by arguing for the importance of the special advocate being able to take instructions from his client—that, I am sure, will be self-evident to everyone—but I ask the Minister to give an assurance that the rules will require gisting and I ask this particularly as Clause 10, to which I have referred, said the rules “may” make the provision, while Clause 7 provides that rules of court “must” secure certain things. I hope I do not read too much into the distinction between those two terms.
Baroness Manningham-Buller
My Lords, I hesitate to stand after the really important contributions by so many Members of this House, including a number of very noble and learned Lords. I do not want to make a long speech, but there are some points that have possibly not been touched upon. The central problem here is about litigants, not defendants. It is about people making claims that currently cannot be heard. This is an attempt by the Government to find a way, imperfect as it is—“a second-best solution”, in the words of David Anderson QC—to get these cases heard and to put into court, albeit in a restricted way, material that is not currently put into court, so that there is a better chance of the full picture being seen by the court. David Anderson said—if I may, I quote him slightly to correct him:
“We are in the world of second-best solutions”.
He added:
“But it does not seem to me that the level of injustice inherent in the use of a CMP in a case of this nature necessarily exceeds either the injustice to the claimant of a case being struck out, or the moral hazard and reputational damage to the intelligence agencies that is caused by settling a case which, had it been possible to adduce all the evidence, would have been fought”.
This does not seem to me to be primarily about the reputation of the security and intelligence agencies. The service of which I was once a member welcomes scrutiny. If we disobey or break the law, we should be prosecuted. The first part of this Bill is about greater scrutiny. I expect that scrutiny to evolve and over the years to become more detailed. However, the reputational damage is significant in a way that has nothing to do with personal feelings; it is to do with whether these organisations, which are funded by the taxpayer and scrutinised by Parliament and other bodies, are going to be less effective as a result of this reputational damage. This needs resolution, but it is not primarily about that. It is primarily about making sure that some of these extraordinarily serious allegations are actually heard. At the moment, we do not have an inquiry. I believe that some criminal investigations are happening, but there are still a whole lot of allegations out there that are not resolved, and this would be a way of resolving them.
There is one other point I want to make, which I think speaks to the amendment made by the noble Lord, Lord Macdonald. On the face of it, the amendment looks unexceptional, but I think it is a question of the confidence of our human sources, which is very important. I do not need protection; they do. A point made by the noble Lord, Lord Owen, was that human sources are either approached by the intelligence and security agencies inviting them to provide information in confidence or they approach us or they are the sources of an ally. Not all of them but many of them do so with the highest motives, and in many cases their lives are at risk—although, again, not always. I look to my noble and learned friend Lord Brown. Obviously I entirely agree with him that national security is undefined and that there is a spectrum. There are some things, which he mentioned, at one end of the spectrum that might be labelled “national security” but are not damaging to reveal. However, at the other end of the spectrum—this has not really been discussed today—there is some highly sensitive and secret material in relation to which the risk to human sources’ lives is high.
I know that I am a bit repetitive on this issue in the House and I apologise, but I still think that it is not given enough attention. Technology is vulnerable. If we expose it in a careless way or in a way that is not protected by this legislation via the test that open justice means that we can ditch the national security side of things—I know that the amendment of the noble Lord, Lord Macdonald, is not as crude as that but there is a suggestion that the two things can be held in balance, and I look again to the point made by my noble and learned friend Lord Lloyd—that will potentially have a very chilling effect on the willingness of people to offer us information. I hope that that is wrong but, if it does have that chilling effect, we will cease to get the information.
Lord Thomas of Gresford
Does the noble Baroness know of a single case in which sensitive security material such as she talks about has been released to the public or to anybody as a result of even the present procedures that apply to this?
Baroness Manningham-Buller
No, but I am saying that if the amendment balances national security versus open justice, however much my former colleagues might seek to reassure human sources that they will be protected and the courts rely on that protection, I fear that they will be apprehensive and will not be willing to talk to us. That is already an issue. That is what I am talking about—not whether the courts and judges have mishandled things. I am not suggesting that for one minute.
Thirdly and finally, I wish to pick up the point made by my noble and learned friend Lord Brown about national security not being defined. If this material were such that it could be redacted or gisted, or if people could give evidence anonymously, we would not need this Bill. To use the words of David Anderson, who is new to this subject and as the independent reviewer of terrorism has looked at all this, these cases are saturated with it and, if it is redacted to that degree, there is nothing to put into the court.
I shall not say any more this evening but I remind the House of the potential damage that we have to continue to guard against.
Lord Phillips of Sudbury
My Lords, I fear that I have to disagree with two eminent judges—the noble and learned Lords, Lord Woolf and Lord Mackay of Clashfern. The noble and learned Lord, Lord Woolf, talked about the judges being in the driving seat and the noble and learned Lord, Lord Mackay, said that under the amendments to the Bill huge discretions are given to judges which we can safely leave in their hands. I agree with both, but the car of the noble and learned Lord, Lord Woolf, and the discretions of the noble and learned Lord, Lord Mackay, are bounded by the Bill we are debating. I believe that Amendments 6A and 6B extend further, although not radically, the protections that I consider necessary in such an important incursion into the ancient liberty of open justice.
Although the Minister made an exemplary opening speech in trying to explain this vast set of important amendments, I am bound to say that where the Government are trenching on open justice, the onus is on them to prove their case beyond peradventure. I do not think that that has been done. The very phrase, “closed material procedures” is a sort of euphemism. Out there people talk of secret courts and secret justice and, of course, they are right. We have had some wonderful speeches tonight, but I was particularly impressed by the noble and learned Lord, Lord Brown of Eaton-under-Heywood, who has behind him possibly a unique body of experience among those in the Chamber at this time through his work as a reviewer under RIPA. I think that I am quoting him rightly. He said that the important and salutary message that we need to send out from this House is one that persuades the country that while doing our difficult duty, and my word, it is difficult to strike the balance, we are none the less—if there is erring on one side or the other—erring on the side of open justice.
I shall finish by adding to the point that the noble and learned Lord made, and the points made by the noble Baronesses, Lady Berridge and Lady Kennedy of The Shaws. One cannot look at issues of extreme violence in some sort of academic vacuum. There is a propensity to violence among our fellow citizens and to extremism of different kinds—the kinds that the security services have to deal with, reminding us how enormously difficult their task is. That does not come out of a clear blue sky; it is the product of social and political contexts within which they live and of which they have experience. Although it is difficult to get one’s hands round this, if we can show that we have gone to every possible, sensible length to minimise trespassing on the principle of open justice, that will help to send out a message in relation to this Bill, which is being closely followed around the country. It will send out the best message, which is least likely to give cause in places we will never go for an increase in the extremism which is the very devil we are trying to guard against.
Amendment 6A, the widely balancing principle, and Amendment 6B, the exhaustion of all other remedies, so to speak, are significant improvements to a Bill that has been hugely improved by the Government, but which would benefit from these further two refinements.
Baroness Butler-Sloss
My Lords, I ought to declare that my daughter is chairman of Liberty, but I fear that she will be very disappointed with me this evening since I do not consider that Amendments 6A or 6B are necessary. Like many others in this House, during the passage of this Bill I have been extremely concerned about whether it was appropriate and whether it went too far. So many have spoken quite emotionally on the concept of closed courts and how inappropriate they are. I think that the Government’s original proposals were unacceptable, as did many others. Ministers have made enormous steps towards great improvements, and as the noble and learned Lord, Lord Woolf, said, they are to be congratulated on those changes. They have now put the judge in the driving seat. The judge now has control.
Proposed new subsection (1D) to Clause 6 refers to the “second condition”, about which not very much has been said. The second condition has to be approved by the court and,
“in the interests of the fair and effective administration of justice in the proceedings to make a declaration”.
One need only remember what the president of the Supreme Court said about the inappropriateness of making such a declaration in other circumstances, unless it is actually necessary and appropriate to see that judges really ought to be trusted not to close a court until they absolutely have to do so.
As we can tell from the various speeches this evening, this has become a very sensitive and somewhat emotive issue. However, there are other circumstances in which judges see evidence that almost nobody else is allowed to see. In a totally different area, as an adoption judge, I would see reports from the guardian and from the adoption agency, usually the social worker, that the birth parents and very often the adopters were not allowed to see. Like other adoption judges in the past—and I assume that the law has not changed on this—I ended up making decisions on evidence that was not shown to part of the court; that is, the most important people, the adopters and the birth parents. It is not unknown for evidence to be provided to judges that cannot be seen by parties, although national security is, of course, in a very special situation.
I respectfully agree with every word said by the noble and learned Lord, Lord Woolf. I had gone the other way at an earlier stage but I have now changed my mind; I am entirely satisfied by this Bill. I was discussing it with the noble and gallant Lord, Lord Stirrup, who cannot be here this evening. I agree with him that one has to strike a balance between these very difficult situations. He and I agree that balance is now reached by this Government and I will support the Government on this.
Lord Gilbert
My Lords, I had not intended to take part in this debate but I have been moved to do so. We have heard this evening that this debate is about the reputation of the security services. We have heard it is about 2,000 to 2,500 years of British justice and that we must of course be on our guard to make sure that we do no damage to either of those principles. However, for me the Bill is not about those things at all. I was a constituency MP for 27 years and I can tell your Lordships that what concerned my constituents was that we should not produce a set of circumstances in which several hundred of them could be blown to smithereens on the District line while going about their ordinary day’s business. That is what concerns them, not what we have been hearing this evening. I have not heard that said once throughout this debate—it astounds me.
Lord Wallace of Tankerness
My Lords, the House will agree that this has been a very good and well informed debate and rightly so because the issues we are dealing with are of fundamental importance to our justice system. I do not think anyone who has taken part or who will vote feels at all comfortable about the idea that there should be closed material proceedings. Nevertheless, as has been explained by a number of contributors to the debate such as the noble Baroness, Lady Ramsay of Cartvale, the noble and learned Lords, Lord Lloyd of Berwick and Lord Woolf, and, although he is supporting the amendments, the noble and learned Lord, Lord Brown of Eaton-under-Heywood, there is a need in current circumstances for closed material proceedings.
The present situation, standing the judgment of the Supreme Court in the Al Rawi case, is that closed material proceedings are not available under common law and the Supreme Court invited Parliament to consider the position. We have sought not only to make provision for closed material proceedings but, as we have gone from Second Reading, through Committee and Report, to the other place for debate and back to us, in doing so we have put in place proper safeguards which reflect the values of our justice system.
The noble and learned Lord, Lord Woolf, said it was important that we show the greatest and utmost care and consideration in addressing these issues, and we have done that tonight. I can assure your Lordships’ House that, in reflecting on the amendments passed on Report in this House, Ministers gave careful consideration to how we might respond to them.
The noble Lord, Lord Beecham, asked about the number of cases that had been settled and how much compensation was paid. As I have explained previously, I am not able to comment on the number or details of many of the cases settled as they are often the subject of confidentiality agreements. However, the House will be aware—indeed, my noble friend Lady Berridge referred to it—that a settlement was recently reached with Mr al-Saadi, on a no-liability basis, to the tune of £2.2 million. I am unable to comment on whether actions have been taken against recipients of other settlements. If such actions have been taken, it would be impossible to comment without breaching the terms of the settlement because it could, for example, indirectly reveal the identity of the individuals concerned.
My noble friend Lady Berridge suggested that perhaps the Government had rushed a settlement to get it in before this legislation went onto the statute book. I am sure that noble Lords will agree that it is not desirable for courts to delay the processing of cases in pre-emptive speculation about what may or may not become available in future legislation. It is unhelpful to suggest that that should be the case. It was and is right that the case of Mr al-Saadi and others should be dealt with quickly and fairly on the basis of existing legislation. The alternative of delaying, pending possible future legislative changes, would be unfair to all parties concerned. I certainly would not like to defend such a situation from the Dispatch Box if that allegation ever had any truth.
The noble and learned Lord, Lord Goldsmith, said that, unlike cases in which he was involved when he was in government and introduced closed material proceedings with regard to control orders under which there were restrictions on freedom, what we are dealing with here is just about money. It is about more than just money; it is also about the reputation of, and the trust and confidence in, our security intelligence agencies. It may also be about executive actions—for example, the judicial review of decisions taken by a Secretary of State on national security grounds which would not be the subject of pre-existing statutory CMPs.
As I have said, it is not just a question about money because, at the end of the day, we are trying to ensure that there will be some kind of proceedings available whereby taxpayers’ money is not spent in settling cases where the case has not been proved. My noble friend Lord Phillips of Sudbury referred to secret justice. I have said in these debates that it is second-best justice, but at least it is justice. There is no justice when cases are settled without any proof of the claim being made.
The importance of the safeguards and how we keep these cases to a minimum—they should be the exception—has been reflected in the debate tonight. My noble friend Lord Macdonald has tabled an amendment that would require the courts to have a balancing test akin to the Wiley balancing test that was developed in the context of public interest immunity. The noble and learned Lord, Lord Lloyd of Berwick, explained why he thought that was inappropriate; he said that it was too wide and imprecise. The noble Lord, Lord Owen, and the noble Baroness, Lady Manningham-Buller, indicated that we are also dealing with situations where there might be foreign sources of intelligence and, crucially, human sources who work on our behalf for our security services. They expressed concern that the imprecision of the test would not be helpful.
My noble friend said that he thought the effect of the Bill as it currently stands, without his amendment, would be that the security services and the Government would opt for CMP rather than PII, public interest immunity, and that somehow that would be convenient for them. The noble Baroness, Lady Manningham-Buller, made the important point that Part 1 of the Bill is about scrutiny of the security services, but Part 2 allows for greater scrutiny. If you wish to push something under the carpet, PII, or settling a case without any evidence being led, is one way of ensuring that information does not come out. Albeit closed material proceedings are closed—for all the reasons that people have articulated in this debate they are not as good as open proceedings—they nevertheless allow the court to examine the material that is there and to apply scrutiny to allegations made against our security services, which otherwise would not be the case.
Regarding openness, my noble friend Lady Berridge referred to the president of the Supreme Court, the noble and learned Lord, Lord Neuberger, and what he said this weekend. The point that was picked up by the noble and learned Lord, Lord Woolf, and the noble and learned Baroness, Lady Butler-Sloss, helps make the point that we have been trying to make. Of course, as more than one contributor to this debate has said, the idea of openness is absolutely intrinsic to our system of justice. The noble and learned Lord, Lord Neuberger, reflected that in his comments this week. It was intrinsic and it was instinctive.
It is absolutely fanciful to imagine that, in applying the tests set out by the Government in the amendments before your Lordships’ House tonight, the judges will somehow forget about openness. It is very clear that the justices of the Supreme Court did not need words in a statute to get them to apply their minds to the importance of openness when it came to making the decision, which they did.
Lord Thomas of Gresford
Is my noble and learned friend saying that the judges will apply a balancing test when they exercise their discretion between open justice and the interests of national security—that that is implicit in everything he is saying?
Lord Wallace of Tankerness
My Lords, it is very clear that open justice is part of our justice system. It is implied by the words “fair and effective”, and it did not need any words in statute to encourage the justices of the Supreme Court to have regard to the importance of openness in these situations. The noble and learned Lord, Lord Neuberger, said the following words, to which I think my noble friend Lady Berridge referred:
“No judge can face with equanimity the prospect of a hearing, or any part of a hearing, which is not only in private, but involves one of the parties not being present or represented”.
He went on to say:
“Nonetheless, as Parliament has decided that, in certain circumstances, such a procedure is necessary and permissible in a trial before a judge, we have concluded that, on an appeal from a decision in a case where a judge has considered closed material and given a closed judgment, it may be necessary for this court to go into closed session in order to dispose of the appeal justly”.
In other words, the just decision on that particular point was that the court would go into closed session.
On the other issue, I also do not find there to be any real difference in what Members of your Lordships’ House wish to see, and it is an issue of judgment as to how we achieve it. These cases should be the rare exceptions; there are a very small number of cases. When I gave evidence by letter to the Joint Committee on Human Rights on 31 October, there were 27 cases which, across government, we considered would lend themselves to closed material proceedings. The noble and learned Lord, Lord Brown of Eaton-under-Heywood, expressed his view as to why closed material proceedings were necessary, but in his judgment these amendments should be in the Bill. I have explained this, and indeed others who have contributed to the debate have also explained why it is not necessary.
We all aim at the same thing: at the end of the day, this should take place in a small number of cases. It is a matter of judgment. As I indicated earlier, at this initial gateway of closed material proceedings the court is considering an application having not yet seen all the material for the case. Against this background, we are keen that legislation should avoid the court being required to meet a condition which would then require it to establish definitively at that point whether a fair determination would be possible by any other means.
As I said, that could mean the exhaustion of a range of measures, including a full PII exercise. Of course, as the noble Baroness, Lady Kennedy of The Shaws, said, it is something to which the Secretary of State should apply his or her mind. If one reads the judgment of Lord Brown in Al Rawi, he indicates at one point that it would take 60 lawyers the best part of two or three years to go through all the material. That is the scale. If that is the road down which judges felt that they ought to go because of the wording of the Bill, that would underline much of its purpose.
I also pick up the point made by the noble and learned Lord, Lord Goldsmith, who seemed to think that the means of achieving it being a backstop and a rare exception was the provision in proposed new subsection (1F) about the court having to be satisfied that the Secretary of State had considered PII. We do not even get to that stage, because the court must not even consider the application unless it is satisfied that the Secretary of State has considered PII. The question asked by the noble Lord, Lord Butler of Brockwell, was very much to the point: the safeguards of last resort, as it were, are not that requirement on the Secretary of State but, rather, the courts being satisfied that the disclosure of material would be damaging to national security, and that it would be in the interests of the fair and effective administration of justice for the application to be granted.
Baroness Kennedy of The Shaws
My Lords, I point out to the Minister that I, too, am a member of the Joint Committee on Human Rights. We looked at whether it would take many months for the Secretary of State to review the material. We were firmly of the view that that is not what is required of the Secretary of State at all. It is only about looking at material that would move it into in the special category which would mean that it would require closed material proceedings. This business that it would take insurmountable periods of time to examine the material is not what we are talking about. The Joint Committee was absolutely satisfied on that.
Lord Wallace of Tankerness
My Lords, I fully accept that the Joint Committee on Human Rights and your Lordships’ Constitution Committee have said that it would be undesirable to go down the path of an exhaustive PII. The point that I am trying to make to your Lordships’ House is that when we make law, the Joint Committee on Human Rights will not be deciding how it is interpreted, it will be the courts. The courts will no doubt be at the receiving end of very eloquent and persuasive arguments from special advocates as to why they should exhaust different routes. That is our concern: if we include such words in the Bill which allow such arguments to be made, the courts may well feel that they must take those exhaustive steps before entertaining an application for closed material proceedings. We believe that that would take away much of the purpose of the provisions.
In conclusion, it is not as if we are just leaving it there. As I said in my opening remarks, we believe that the tests that we have in place, giving considerable discretion to the judges, the revocation possibilities during the review and the disclosure phase, and the requirement on the court to consider at the end of all the disclosure whether closed material proceedings should still continue constitute a very powerful weapon in the hands of the court and at judges’ discretion that will ensure that those procedures will be used only in truly exceptional cases.
My noble friend Lady Hamwee asked about the change from “must” to “may”. She is absolutely right: it is only if all those conditions are fulfilled that the court may grant an application for and make a declaration of closed material proceedings. Even at that stage, the court has discretion whether or not to do so. The noble and learned Lord, Lord Woolf, asked whether it gives the judges discretion to do the right thing in the circumstances of the particular case. I very much believe that what we have put in place in the other place does that. I fear that to accept the amendments could in some ways undermine that, although I fully understand why they have been moved. I believe that we have the right discretion for our judges in place. As the noble and learned Lord, Lord Goldsmith, said, trust the judges. On that basis, I beg to move.
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendment 5.
“(1A) The court may make such a declaration—
(a) on the application of—
(i) the Secretary of State (whether or not the Secretary of State is a party to the proceedings), or
(ii) any party to the proceedings, or
(b) of its own motion.”
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendment 6.
“(1B) The court may make such a declaration if it considers that the following two conditions are met.
(1C) The first condition is that—
(a) a party to the proceedings would be required to disclose sensitive material in the course of the proceedings to another person (whether or not another party to the proceedings), or
(b) a party to the proceedings would be required to make such a disclosure were it not for one or more of the following—
(i) the possibility of a claim for public interest immunity in relation to the material,
(ii) the fact that there would be no requirement to disclose if the party chose not to rely on the material,
(iii) section 17(1) of the Regulation of Investigatory Powers Act 2000 (exclusion for intercept material),
(iv) any other enactment that would prevent the party from disclosing the material but would not do so if the proceedings were proceedings in relation to which there was a declaration under this section.
(1D) The second condition is that it is in the interests of the fair and effective administration of justice in the proceedings to make a declaration.
(1E) The two conditions are met if the court considers that they are met in relation to any material that would be required to be disclosed in the course of the proceedings (and an application under subsection (1A)(a) need not be based on all of the material that might meet the conditions or on material that the applicant would be required to disclose).
(1F) The court must not consider an application by the Secretary of State under subsection (1A)(a) unless it is satisfied that the Secretary of State has, before making the application, considered whether to make, or advise another person to make, a claim for public interest immunity in relation to the material on which the application is based.
(1G) A declaration under this section must identify the party or parties to the proceedings who would be required to disclose the sensitive material (“a relevant person”).”
Lord Beecham
Lord Beecham
My Lords, your Lordships will be at one with the noble and learned Lord, Lord Mackay of Clashfern, in agreeing that it is the prime duty of government to protect the national security. That is currently being achieved by a variety of means, including PII. It would continue to be achieved under the terms of this amendment if your Lordships’ House agrees to it and if that is confirmed by the House of Commons. Your Lordships’ House is usually and naturally reluctant to overturn Commons amendments. There can be no better or more necessary occasion to do so than when issues profoundly affecting our system of justice or the rights of citizens are at stake. This is just such an occasion. I beg to move and test the opinion of the House.
Lord Wallace of Tankerness
My Lords, for the convenience of the House, I will speak also to the other amendments in this group. The Government have listened to concerns expressed in this House and elsewhere about transparency, particularly around the new closed material proceedings provisions. I know that several Members of your Lordships’ House expressed frustration at the lack of information available about how many CMPs take place.
The Government have accepted that the unusual nature of CMPs means that there would be significant public and parliamentary interest in more information about how the provisions in this Bill will operate. A strong view was expressed in this House, although no amendments to the Bill were passed, that reporting and review arrangements would be valuable safeguards.
The Government have brought forward amendments that address these concerns. We decided to adopt the expert view of the Constitution Committee by providing for annual reporting to Parliament and for a review of the CMP provisions under this Bill to be conducted five years after Royal Assent. The Joint Committee on Human Rights also made similar recommendations.
Given the often lengthy nature of litigation, with cases often lasting more than a year and sometimes several years, we believe that the frequency of review under these provisions allows for regular but meaningful reporting and for a review to be informed by enough cases to provide for substantiated conclusions and reasoned recommendations where necessary.
An annual report is the most proportionate approach. We expect that the CMP provisions in the Bill will be used rarely. More frequent reports may contain too few data to be meaningful. Annual reports will not, however, be the only way in which facts relating to cases involving CMPs will be made public during the reporting period. The Government made an amendment when the Bill was last considered by this House to ensure that where an application is made under Clause 6(2), that fact must be reported to the other parties in proceedings; and there are already existing mechanisms by which the courts publish their open judgments and the media report on cases of interest to the public.
The reports will focus on the volume of cases and applications. The amendment lists the matters of key concern to be included in the annual report as: the number of applications for a CMP declaration and by whom the applications are made; the number of declarations and revocations made by the court; and the number of judgments published, both open and closed, with respect to the determination of Section 6 proceedings—this would include judgments made on the substantive trial and judgments made regarding the outcome of the application for a CMP declaration. The reporting arrangements will also cover “deemed” Section 6 proceedings or those treated as Section 6 proceedings.
In addition to an annual reporting requirement, the Government have introduced provisions for a comprehensive review of the operation of the CMP provisions in this Bill after five years, conducted by an independent figure and with a report made to Parliament. We expect such a review to take into account the views of special advocates, among others; to consider efficiency, trends and types of case; and to analyse the numbers provided in the annual reports to reflect on how CMPs are being used. The reviewer will have to take care not to comment on judicial decisions or on how the judge has run particular cases.
In line with most other legislation, this clause provides for the appointment of the reviewer by the Secretary of State. Amendment 19A in the name of my noble friend Lord Marks would require consultation first with the Lord Chief Justices and the Lord President of the Court of Session. We do not believe that such consultation is necessary for a reviewer or commissioner to be independent or to be perceived as being independent, as has been repeatedly shown by the independence displayed by Mr David Anderson QC and other independent reviewers and commissioners. David Anderson has been clear about his views on this Bill, for example, and has been influential in persuading the Government to change their position on a number of issues. Such appointments are now subject to a statutory code for public appointments to ensure that they are undertaken transparently and on merit. This should provide reassurance that the person with the right skills and background will be appointed.
It has also been suggested that a review after a shorter period of time would be better. My noble friend’s Amendment 19B would reduce this period from five to four years, which I note seeks to ensure that the sunsetting provision follows consideration of the reviewer’s report. I believe that given how long litigation can take and the small number of cases expected, five years is the right period for there to be enough evidence for a review meaningfully to draw upon.
Amendment 19C would require a further review every five years. In its report, the Constitution Committee said the House may wish to consider the Bill being independently reviewed five years after it comes into force. We have followed that recommendation. Any reviews should be focused where there is proper justification for them, and they should be proportionate.
We should remember that judges have full discretion over whether to grant a CMP, whether to revoke it at any point in a case, whether they agree with the Secretary of State’s assessment of national security damage, how material should be treated within the CMP, effective management of the case, whether a CMP should continue, and in deciding the outcome. There have also been some suggestions that the unusual nature of the CMP provisions means that a sunset clause would be appropriate. This would allow Parliament the opportunity to revisit the need for the provisions in the Bill once they had been operating for a while. The Joint Committee on Human Rights recommended such a provision but the Constitution Committee did not.
Amendment 19D in the name of my noble friend Lord Marks and Amendment 19E, tabled by the noble Lord, Lord Beecham, seek to introduce a sunset and renewal clause for the new CMP provisions, requiring renewal every five years. My noble friend’s amendment provides for a renewal order to follow completion of the reviewer’s report. His amendment makes it clear that the CMP provisions would cease to take effect except relating to proceedings where a declaration had already been made, thereby not interrupting ongoing cases.
I point out to noble Lords that the effect of this amendment would also be to disrupt the Norwich Pharmacal clauses in the Bill that are intended to bring clarity to the Norwich Pharmacal jurisdiction when sensitive information is involved and to provide reassurance to intelligence-sharing partners, a point that was made in the previous debate by the noble Lord, Lord Owen. Although such a clause would apply to the new CMP Clauses 6 to 10 of the Bill, it would also affect proceedings connected to Norwich Pharmacal, both those where the Secretary of State would need to apply for a CMP and the reviews of certificates issued by the Secretary of State under the Norwich Pharmacal clauses. These proceedings are deemed to be Section 6 proceedings because the case needs to be heard in a closed material procedure to ensure that the outcome of the proceedings is not prejudiced by having already publicly disclosed the very information with which the proceedings are concerned.
Such a sunset clause would undermine the purpose of the Bill and unnecessarily so. Both Houses have agreed that there is a gap in the law, that there are circumstances where a judge may decide that a CMP is preferable, that claimants’ cases must sometimes automatically fail without a CMP and that the judge should have a CMP in his toolkit. Given the wide discretion that we have given the judge about when the provisions should be used, I do not know why we would then want to remove CMPs from the judge’s toolkit.
As I have said, the Bill provides for the procedures of the court over which the judge has discretion and not the exercise of controls by the Executive. I reinforce the point, made in an earlier debate, that international partners have expressed concerns regarding the United Kingdom’s ability to protect sensitive information shared with the United Kingdom in cases where claimants are making allegations against the state and its defence rests on national security material. We risk further undermining the confidence that partners have to share information with us if they feel that we do not have secure processes in place to protect their material while defending government actions. We fear that a sunset clause would introduce unnecessary uncertainty.
As I indicated before, the Constitution Committee did not recommend a sunset clause. In its report it said that the House may wish to consider the Bill being independently reviewed, but not renewed, five years after it comes into force; or rather it did not recommend renewal. The Government have accepted the Constitution Committee’s recommendations, and believe that the report and review provisions are sufficient to provide reassurance about how CMPs are used. I therefore beg to move that the House agrees with the Commons in their amendments.
Lord Marks of Henley-on-Thames
My Lords, I rise to speak to Amendments 19A to 19D in my name as amendments to Amendment 19, concerning review and renewal of the operation of CMPs in the legislation.
In the other place, as my noble and learned friend has explained, the Government conceded that the operation of Clauses 6 to 10 of the Bill should be the subject of a review after five years of the Bill’s operation. That is the effect of Amendment 19. As far as they go, the provisions of the amendment are welcome. They were introduced against the background of the recommendation of the Joint Committee on Human Rights in each of its two reports in November last year and February this year that the operation of Part 2 of the Bill should be subject to annual renewal. This amendment not only fails to meet that recommendation but, as it stands, has a number of significant weaknesses that make it frankly unfit for its purpose.
First, proposed new subsection (1) requires the Secretary of State on his or her own to appoint the reviewer. Yet one of the central complaints about the Bill, as my noble friend Lord Macdonald pointed out earlier, is that in practice it gives too much power to the state and to the Secretary of State in particular. The concerns focus not only on the degree to which the Bill sacrifices common-law principles of fairness and open justice but also on the relationship between the Secretary of State and the courts. That remains true notwithstanding the concessions, important though they are, that there have been on judicial discretion and equality of arms.
The Bill undoubtedly accords to the Secretary of State significant new power to influence how trials of some civil cases may be conducted. How the Secretary of State exercises that power and whether it is found in the light of experience to be either excessive or unnecessary will be fundamental questions for the reviewer to address.
Lord Butler of Brockwell
My Lords, I want to reinforce what the Minister has said about the prejudice which a sunset clause would have to the confidence which partners would have in us. I noticed that the noble Lord, Lord Marks, was modifying his proposals in his speech because he has recognised that.
Let us suppose that an ally is at this moment considering whether to pass confidences to the Government. If those confidences were held by the intelligence services they would be protected under the Bill. If they were held by another department, they could be protected only by a certificate passed by a Secretary of State. If at this moment the ally was considering whether to pass those confidences to this country and was uncertain whether in four or five years’ time there would be closed procedures under which that certificate could then be considered, it would be a matter of uncertainty whether those confidences would be protected in four or five years’ time. That would affect the willingness of allies to pass secrets to us now. It would, therefore, be very damaging if a sunset clause in the form proposed originally by the noble Lord, Lord Marks, supported by the Opposition, were to pass into law. I very much hope that the House will not support that proposal.
Lord Beecham
My Lords, I support the amendments tabled by the noble Lord, Lord Marks, and I am prepared to say at this stage that I will not be pressing my own amendment, which is on similar terms at least to the last amendment that the noble Lord has moved.
The noble Lord, Lord Butler, has adumbrated a case in which it would seem almost that the doctrine that no Parliament can bind its successor is somehow to be disregarded. Of course, it would be open to any subsequent Parliament to amend this law in any event. Any nation dealing with us will be aware of that. There is not, therefore, a great deal of force in what the noble Lord has been proposing as a justification for supporting the Government’s position on this matter.
The question arises: what is the point of a review? If a review is to take place—and the Government have given welcome acceptance to that concept—where does it lead? Apparently it would lead nowhere. The whole purpose of the review in these circumstances would be vitiated. There needs to be a review, given the nature of the change in our proceedings for us to establish a principle that there should be a renewal, and certainly on that basis I am prepared to support the noble Lord’s amendments.
Lord Wallace of Tankerness
My Lords, this has been a relatively short debate, but nevertheless important points have been made by my noble friend Lord Marks and the noble Lords, Lord Butler and Lord Beecham.
The first point I wish to make with regard to the first amendment in the name of my noble friend is, as I indicated in my opening remarks, that a number of public appointments, not least the appointment of Sir David Anderson, have been made by the Secretary of State without the consultation that my noble friend is suggesting in his amendment. I know that it is furthest from my noble friend’s mind to suggest this, but I am sure we would not want a situation where perhaps the appointment of some independent reviewers was questioned because they had not had the same statutory consultation requirements as have been proposed here.
I do not think anyone can deny that the role that Mr David Anderson plays is a very sensitive one. The independent reviewer of terrorism legislation reviews quite significantly the actions of the Executive. It is in the interests, too, of the Secretary of State that the person appointed as the reviewer is credible. I do not think that the recent appointment by the Home Secretary of the Biometrics Commissioner—or indeed of Mr Anderson—has given rise to any concerns. I would caution against fixing a problem that does not exist, because you might inadvertently create another problem by perhaps casting some doubt on the independence of those who have been appointed under the present regime. The Secretary of State should have the discretion, in a highly sensitive national security context, to ensure the appointment of an individual who does not pose any risk. I am sure that would be agreed across the House.
I listened to what my noble friend said and, as the noble Lord, Lord Butler, pointed out, he indicated that he was perhaps shifting—that is not a criticism at all—on the position of the renewal, given the deemed Section 6 proceedings as far as Norwich Pharmacal is concerned. The noble Lord, Lord Butler, makes an important point with regard to the confidence in which other countries share information with us. The fact that there would be regular potential for renewals puts it in a different category from that raised by the noble Lord, Lord Beecham, and it could raise a problem. In one of our earliest debates, the noble Lord, Lord Butler, indicated from a visit to America that when we discussed information perhaps being withheld, it was not fanciful; it was something that he actually encountered in his role as a member of the ISC.
I simply say to my noble friend and to the noble Lord, Lord Beecham, who ask what is the point of a review if nothing could happen, that the answer lies in what the noble Lord, Lord Beecham, himself said. No one is suggesting that this Parliament is binding its successors by this. I remind the House that it is not just the actions of the Executive and the Secretary of State; it is the whole system that we are setting up, which involves the courts. If a review proved that closed material proceedings were not working, manifest injustice was following on from them and they were not actually doing what they were set up to do, of course it would be possible for a future Parliament, through primary legislation, to repeal the legislation if that system is not working. Indeed, it may not go as far as repeal. It may be that a review would point out particular things that perhaps needed amendment, falling far short of a repeal. So a review could have a proper purpose that does not necessarily require a renewal order to follow on from it. In these circumstances, I invite the House to support and approve the amendments that have been brought from another place and I invite my noble friend not to move his amendment.
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendment 19.
“Review of sections 6 to 10
(1) The Secretary of State must appoint a person to review the operation of sections 6 to 10 (the “reviewer”).
(2) The reviewer must carry out a review of the operation of sections 6 to 10 in respect of the period of five years beginning with the day on which section 6 comes into force.
(3) The review must be completed as soon as reasonably practicable after the end of the period to which the review relates.
(4) As soon as reasonably practicable after completing a review under this section, the reviewer must send to the Secretary of State a report on its outcome.
(5) On receiving a report under subsection (4), the Secretary of State must lay a copy of it before Parliament.
(6) Before laying a copy of a report before Parliament under subsection (5), the Secretary of State may, after consulting the reviewer, exclude from the copy any part of the report that would, in the opinion of the Secretary of State, be damaging to the interests of national security if it were included in the copy laid before Parliament.
(7) The Secretary of State may pay to the reviewer—
(a) expenses incurred by the reviewer in carrying out functions under this section, and
(b) such allowances as the Secretary of State determines.”
Lord Marks of Henley-on-Thames
I have not moved Amendment 19A, but Amendments 19B to 19D, as a suite, on the principle of renewal, are extremely important. In those circumstances, I do not accept the argument put by the noble Lord, Lord Butler. I cannot believe that it is beyond the wit of man to produce, in this legislation, a very clear signal that a review of certificates on Norwich Pharmacal proceedings can proceed without impairing the renewal amendment. In those circumstances, I wish to test the opinion of the House.
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendments 20 to 24.
““sensitive material” has the meaning given by section 6(9),”
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendment 25.
Lord Wallace of Tankerness
My Lords, I beg to move that this House do agree with the Commons in their Amendment 25. This is a minor technical amendment. It removes the privilege amendment which was inserted into the Bill at Third Reading in this House to recognise the privilege of the other place to control any charges on the people or on public funds. The removal of this amendment at this point is standard procedure.
Lord Wallace of Tankerness
That this House do agree with the Commons in their Amendments 26 to 45.
“(6) The ISC may take evidence on oath, and for that purpose may administer oaths.”
“Funding and other resources
A Minister of the Crown—
(a) may make payments to either House of Parliament in respect of any expenditure incurred, or to be incurred, by either House in relation to the ISC,
(b) may provide staff, accommodation or other resources to either House of Parliament for the purposes of the ISC,
(c) may make payments, or provide staff, accommodation or other resources, to the ISC, or
(d) may otherwise make payments, or provide staff, accommodation or other resources, to any person for the purposes of the ISC.”
“( ) This paragraph applies to information requested by the ISC in the exercise of its functions that—
(a) does not relate to any particular operational matter, or
(b) relates to a particular operational matter that the ISC is considering under section 2(3)(a) or (b).”
“Publication of information received in private
5 (1) This paragraph applies to information received by the ISC in private in connection with the exercise of its functions.
(2) The ISC—
(a) may only publish the information by way of a report under section 3, and
(b) must not otherwise disclose the information to any person if the ISC considers that there is a risk that the person will publish it.
(3) The restrictions on publication and disclosure of information in sub-paragraph (2) do not apply if—
(a) the ISC and the Prime Minister are satisfied that publication or disclosure would not be prejudicial to the continued discharge of the functions of the Security Service, the Secret Intelligence Service, the Government Communications Headquarters or any person carrying out activities falling within section 2(2),
(b) publication or disclosure is necessary for the ISC to comply with any enactment or rule of law, or
(c) the information has on an earlier occasion been disclosed to the public, in circumstances which do not contravene—
(i) sub-paragraph (2), or
(ii) any other enactment or rule of law prohibiting or restricting the disclosure of information.”
“Protection for witnesses
6 (1) Evidence given by a person who is a witness before the ISC may not be used in any civil or disciplinary proceedings, unless the evidence was given in bad faith.
(2) Evidence given by a person who is a witness before the ISC may not be used against the person in any criminal proceedings, unless the evidence was given in bad faith.”
“Data Protection Act 1998 (c. 29)
In section 63A of the Data Protection Act 1998 (application to Parliament)—
(a) in subsection (2), after “Commons,” insert “other than where they are determined by or on behalf of the Intelligence and Security Committee of Parliament,”, and
(b) in subsection (3), after “Lords,” insert “other than where they are determined by or on behalf of the Intelligence and Security Committee of Parliament,”.”
(b) after “Committee” insert “of Parliament”.”
“Freedom of Information Act 2000 (c. 36)
(1) The Freedom of Information Act 2000 is amended as follows.
(2) In section 23 (information supplied by, or relating to, bodies dealing with security matters), in subsection (3), at the end insert—
“(o) the Intelligence and Security Committee of Parliament.”
(3) In Part 1 of Schedule 1 (Public Authorities; General)—
(a) in paragraph 2, after paragraph (d) insert—
“(e) information held by the Intelligence and Security Committee of Parliament.”, and
(b) in paragraph 3, after paragraph (d) insert—
“(e) information held by the Intelligence and Security Committee of Parliament.””
(b) after “Committee” insert “of Parliament”.”