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Commons Chamber

Volume 350: debated on Tuesday 23 May 2000

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House Of Commons

Tuesday 23 May 2000

The House met at half-past Two o'clock


[MADAM SPEAKER in the Chair]

Private Business

City Of Newcastle Upon Tyne Bill Lords (By Order)

Order for Third Reading read.

To be read the Third time on Tuesday 6 June.

Greenham And Crookham Commons Bill (By Order)

Order for Second Reading read.

To be read a Second time on Tuesday 6 June.

Oral Answers To Questions


The Secretary of State was asked—

Youth Unemployment


If he will make a statement on the impact of the new deal on the level of youth unemployment. [121870]

Youth unemployment has fallen by 71 per cent. since April 1997, and the new deal has made a significant impact in achieving that improvement.

I thank my right hon. Friend for that comprehensive answer. [Laughter.] I should like to bring to his attention the fact that, since 1979, there has been an immense drop in youth unemployment in my constituency—in fact, one could say that it has fallen like a stone—but much is still to be done. What is being done under the new deal for over 55-year-olds?

My hon. Friend will appreciate just what an impact the new deal has had on young people in Scotland. The mockery of Scottish National party Members is the same as they showed when we introduced the new deal. However, it is not a laughing matter for the 23,000 young people in Scotland who have benefited from it. If this Government had said in 1997 that we would slash youth unemployment by almost 75 per cent.—by 71 per cent.—in three years, no one would have believed us.

My hon. Friend is right that not only the young faced the terrible spectre of dole queues under the previous Government. I am glad to say that my hon. Friend the Minister of State, Scotland Office only yesterday extended the new deal so that those aged over 50 will be able to benefit, as our young people have. That is another step forward in recognising that, although we have made major achievements, there is still much to be done.

Does the Secretary of State recognise that the success of the new deal is about getting people fit for work and helping them to find work when it is available? Therefore, crucial to the long-term prospects of the young unemployed and over-50-year-olds is investment by manufacturing, agriculture, the oil industry and tourism in job creation for such people in the Scottish economy. Does he therefore recognise, like the Secretary for State for Northern Ireland, that that investment is put at risk by the stresses of the high pound on those industries?

The hon. Gentleman is correct that the Government themselves cannot create jobs; we can only create the economic framework in which those jobs are created. That is why I am extremely pleased that that is exemplified in Scotland by the highest employment for more than 30 years—2.3 million—the lowest unemployment for 25 years and the lowest sustained inflation in generations. We are reducing the national debt and we have a surplus on the current account of £17 billion compared with the £20 billion deficit that the Tory party produced.

The hon. Gentleman is correct that one effect of that strong economy is a strong pound—in the face of a very weak euro. That has caused problems, but I am glad that manufacturing in Scotland has overcome them by increasing its output in the past year, increasing exports by 8 per cent. over the past period and increasing employment. So, I would be the last to say that we cannot do any better, but I think that the hon. Gentleman will recognise just what significant advances have been made.

My right hon. Friend will be aware that, although unemployment in my constituency has fallen by more than 25 per cent. in the past three years and youth unemployment has more than halved, there is still a systemic difference between local unemployment in some areas, including east Ayrshire, and the Scottish average of about 2 per cent. That is despite the many thousands of job vacancies in the market. It is for that reason that the Chancellor announced the special initiative for certain areas, including east Ayrshire, of job action zones—special targeted help to match unemployed people to jobs. Will my right hon. Friend cheer up the people of east Ayrshire by giving a general indication of when they may expect some action in the job action zone?

My hon. Friend is right that, despite the success of the new deal, we are not content that enough has yet been done. We introduced it for the long-term unemployed and, as I said, have extended it to those aged over 50 and to the partners of those who are out of work. In addition, the Chancellor has announced that we shall be introducing employment action zones. I obviously do not wish to pre-empt any decision on that, but I do not think that the people of east Ayrshire or my hon. Friend will have long to wait for that decision.

Is the Secretary of State aware of the report of the Education and Employment Committee, which calls for

greater decentralisation within the New Deal so that it can respond to local needs?
Will he reflect on the contents of that report? Does he believe that it strengthens the case for devolving responsibility for the new deal to the Scottish Parliament?

First, I welcome the hon. Gentleman to Westminster again.

The new deal has been an outstanding success in Scotland, but we are always considering ways to improve it. I am glad to be able to tell the hon. Gentleman—he probably has not noticed—that we are establishing a Scottish task force on the new deal. We also work hand in glove and in partnership with the Scottish Executive on this, as on many other issues. We genuinely believe that devolution is a constructive partnership of the Parliaments within the United Kingdom. That is why so many of our areas are covered by British and Scottish Ministers working together.

I fully understand that that is not the view of the hon. Gentleman, that he wants the two Parliaments to be in confrontation, and that every subject he raises, from the boxing ring to the unemployed, will be raised with one objective, which is to push the Parliaments apart and set them in confrontation. In that context, I am surprised that he was not here yesterday, when my right hon. Friend the Home Secretary was at the Box. After all the shouting by members of his party last week, they could not even be here to take up the matters in question. It is the usual old story: all talk in Scotland from the SNP and no action at Westminster.

Is my right hon. Friend aware that in my constituency since the election unemployment among young people has dropped by two thirds and unemployment generally has dropped by a third? That is very welcome. But is my right hon. Friend also aware that unemployment there is now the worst in Scotland? Does he accept that the removal of assisted area status from a large sector of my constituency is unlikely to be helpful in generating jobs, and that it is important that Govan shipbuilders be given a clear assurance that work will be found to make sure that that yard remains in operation until the new orders come through for the type 45 frigates? Would he further agree, since he himself mentioned boxing, that Mike Tyson coming to Glasgow gives exactly the wrong impression—

Order. These questions are far too long. We have not even reached the end of question 1 yet.

In deference to what you have just said, Madam Speaker, I shall answer only the first three points that my hon. Friend raised.

First, I thank him for his congratulations on the reduction of unemployment in his constituency.

Secondly, the decisions on assisted areas were very difficult, because we had to negotiate them with the European Union. But I think that Scotland has had a good deal out of that.

Thirdly, everything possible is being done to make sure that fair and full consideration is given to Govan when it comes to the placing of Ministry of Defence orders.

We welcome the reduction in the level of unemployment, but we are not wholly convinced that the new deal, rather than the overall revival of the economy that started under the last Government, has had a great part to play in it, Will the Secretary of State confirm that of those going through the new deal some 36 per cent. either go back on to welfare or disappear from the system, so that it does not appear that they are traceable? Will he also confirm that about a quarter of those who obtain work come out of work shortly thereafter, whereas the whole purpose is to reduce long-term unemployment, and that all this costs £19,000 per person found a job? Would he, then, agree that the new deal's success is in fact far less than he seeks credit for?

It is significant that in the face of a huge cut in youth unemployment the hon. Gentleman chooses not to talk about that, but to have a philosophical discussion on the factors potentially underlying it. It would have been better simply to say that we are all very pleased that three out of four young people who were on the dole under his Government are no longer on the dole under the present Government.

As for those young people who go on to the new deal and do not immediately enter a full-time job, it is of course a high percentage—higher than we would like. But it still means that we get 64 per cent. of them in a job. We have a client group that is very difficult precisely because the new deal is targeted at those who, for generations under the Tory Government, were not in jobs. They are a very difficult group to place. They are being placed only because of the economic climate, which is allowing jobs to be created, and because of the assistance the Government are giving to them. By anybody's standards, a 71 per cent. cut in three years is not a bad figure.

The Secretary of State misunderstands the role of the Opposition, which is to welcome the reduction in unemployment but to question the method and the credit that he claims. I shall try to illustrate one of the difficulties so that we may have a sensible question and answer session. It was said about the new deal that the Scotland Office and the Scottish Executive would take 50 trainees. In fact, they have never managed to take more than 12. What is the reason for that?

The reason is that my total staff has been reduced from 4,200 to 86. The hon. Gentleman may not have noticed that, but as he is always the first to accuse me of empire building, that is a bit cheeky.

Order. I hope that we can make a little faster progress. Both questions and answers are far too long. It has taken us 15 minutes to deal with one question.

Working Families Tax Credit


What representations he has received from political parties on publicising the working families tax credit in Scotland. [121872]

I shall try to speak quickly. The Government are determined to maximise the take-up of working families tax credit, which is why it has been well publicised in Scotland, through television, newspapers and magazines.

Is the Minister aware that some of the poorer families to whom I have spoken in the past few weeks are receiving upwards of an extra £60 a week from WFTC? Does he agree that it is one of the main planks of social justice in Scotland and is he proud to be a member of a Government who are trying to take poverty out of Scotland rather than just trying to take Scotland out of the United Kingdom?

I am very proud of the anti-poverty measures being taken by the Government. It is important that people see them as a cohesive philosophy that joins up measures to attack poverty at the root and provides, through educational policies, the means to raise aspirations and give people in our society better prospects. The WFTC could provide help to 130,000 families in Scotland at the significant level that my hon. Friend mentioned. [Interruption.] I have no idea why the SNP sneers at those 130,000 poor families in Scotland. The important point is that of those 130,000, some 99,000 are claiming WFTC. Some 31,000 more families could claim that substantial additional income and if one family sees this broadcast from the House and claims as a result, we will have spent our time well.

The Minister is right that the WFTC is an important benefit. It has only been paid since October and the Government should do everything they can to publicise eligibility and improve take-up. Will the Minister accept that we should consider not only absolute numbers but the percentage of those who are eligible who claim? The benefit replaced family credit, which had a high take-up, and it would be a shame if WFTC did not reach the same proportion of those eligible. Will he also bear in mind the extreme importance of the success of the new child care tax credit? The old family credit assistance for children was very restrictive and I hope that publicity will also be given to the child care tax credit.

I thank the hon. Gentleman for that constructive contribution. He is absolutely right on all counts, but I can assure him that everyone who was on family credit has moved to WFTC. I can also assure him that by the end of March 10,300 awards had been made of WFTC containing elements of child care tax credit, and that compares favourably with the 4,900 who gained from the child care earnings disregard under the family credit scheme. We have doubled the number benefiting from the child care element and, in general, more people qualify for WFTC. It is a substantial benefit for low-income families and I want every eligible family to claim it. It should be the job of us all, from whatever party, to ensure that that happens.

I am sure that my hon. Friend must be as distressed as I am to meet people who still believe that WFTC will not make them better off if they enter work. Like my hon. Friend the Member for Dumbarton (Mr. McFall), I have met families who are between £40 and £60 a week better off, but a few people are still convinced that it would not benefit them. Would not it be better if the SNP, instead of being cynical about WFTC, encouraged those people to get back into work and get out of poverty?

I am not interested in stupid point scoring. I am interested in action and in the money that will be paid to less well off families, as is my hon. Friend. No family with a weekly income below £238 will pay income tax. From June, the figure rises to £245. In April 2001, it will increase to £255. If any such family is paying income tax, it should not be. That is an important message. As a result of the Budget and previous Budgets, a single earner family with two children on £12,500 a year will be £3,000 better off. These are important statistics for low-income families. They should be understood and the benefit should be claimed.

Will the Minister give a commitment to talk to businesses in Scotland that have to administer the working families tax credit? He will know that the burden of rules and regulations has increased and now amounts to £10 billion since the Government came to power. Smaller businesses find it proportionately more difficult to tackle the problems of the administrative burden. Will he talk to them to ascertain what can be introduced to alleviate the extra burden?

I visit smaller businesses all the time. The issue that the hon. Gentleman has raised is not something that comes up as a big problem. We always try to simplify systems. I think that the vast majority of companies are well attuned to administering such a system. If there are complaints which they want to raise with me, I shall be pleased to discuss them.



If he will make a statement on the Government's plans for the future regulation of electricity supply, generation and distribution in Scotland. [121873]

The provisions of the Utilities Bill will put service to consumers at the heart of the regulatory process.

Does my hon. Friend share my pleasure that the Utilities Bill will establish a new and independent Gas and Electricity Consumer Council, which will be responsible for forwarding the interests of the consumer?

My hon. Friend will be aware because I told him that my spouse was caught by basically a mis-selling trick by signing what she thought was an inquiry form for a transfer from electricity to gas. She found that she had signed a contract. I had eventually to write to Sir Ian Robinson, from whom I received a letter of apology for the mis-selling. Will my hon. Friend assure me that the new independent council will stop rogue mis-selling by agencies that are not part of utilities but receive money for getting people to sign up by basically conning them into signing forms?

I am glad that my hon. Friend acted so effectively on behalf of his constituent. His point speaks for itself. Any form of rogue mis-selling is clearly improper. A strong consumer body will be empowered to consider that sort of practice. It is important also to say that it will have an office in Scotland. The exact structure is being finalised, but we shall have a more effective consumer body to ensure that the consumer interest is at the heart of the entire process.

Given the imminent construction of the electricity interconnector from the west coast of Scotland, what plans are there for extra patrols on the foreshore to warn of the washing up of phosphorous devices as a result of the construction?

I am aware of the problem with phosphorous devices. If additional measures are necessary, I shall be happy to hear from the hon. Gentleman. I will take up the matter with the various agencies to ensure that public safety is of paramount importance.

Does my hon. Friend agree that the cost of electricity and other forms of heating is still far too high for many poor families in Scotland? Will he therefore agree to bring to the notice of his colleagues on the interdepartmental group on fuel poverty the real hardship in terms of health and economic cost that is faced by many thousands of families in Scotland as a result of fuel poverty and the adverse climatic conditions that occur every winter? Does he agree that even more urgent attention needs to be paid to the problem?

I agree with my hon. Friend. It is necessary constantly to ensure that nobody is impoverished by the need to have warm, dry homes. That must be a primary objective of government. I need hardly point out to my hon. Friend that we have done much in this regard by means of insulation programmes and grants, for example. We have also substantially increased the winter fuel allowance for pensioners to £150 next year. However, I would be the last to pretend that there is nothing more to be done. My hon. Friend has a very honourable record of contributing to that debate.

Tax Raising Powers


If he will meet the Scottish Executive to discuss the implications for the Scottish economy of devolved tax-raising powers. [121875]

I meet regularly with Scottish Executive Ministers to discuss a range of issues.

Does the Secretary of State agree that an additional rate of income tax, apart from doing economic damage to Scotland, would create a bureaucratic nightmare—particularly, for example, for self-employed organisations that do work both north and south of the border and for people moving house during the year? Will he at least have a discussion with the Scottish Executive to ensure that, before the system is implemented, it will work? Will he personally urge the Scottish Parliament not to get involved in a tartan tax?

I always have the feeling that the hon. Gentleman is arguing the case from where he left off when he departed Scotland. All of those issues were settled many years ago, and the Scottish people voted for a tax-raising power. However, it is obvious that if any Scottish Executive wished to implement the power, they would ensure that it worked before going ahead with it. As for the current, Labour-led Scottish Executive, before the Scottish parliamentary elections, the Labour party made it clear that it would not be using that tax-raising power in the first Parliament. The matter, therefore, does not arise in the immediate future.


The Advocate-General was asked—

Human Rights Convention


What recent advice she has given on the introduction into Scots law of the European convention on human rights and its implications for practising (a) lawyers and (b) judges. [121890]

I have had many meetings in different parts of Scotland and in London in which I have discussed the implications for Scots law of the European convention. As Advocate-General, I give legal advice on matters of human rights. I have also ensured that United Kingdom Department lawyers are aware of the effects on Scots Law of the introduction of convention rights. I regularly inform UK Departments about the implications of devolution issues that have been raised in Scotland.

When the hon. and learned Lady and I were law students at our respective Scottish universities and European law was first introduced into Scots law, there was an obligatory European Community law course. Has she advised that a similar obligatory course should be introduced for all undergraduates, practising lawyers and sitting judges in Scotland?

It is not for me as Advocate-General, but for the Scottish Executive, to give such advice. It is also a matter of the organisation of universities and of the various training courses that they offer. I have, however, visited various Scottish universities, and I am pleased to advise that their students are very well-informed about the European convention on human rights. It is a matter of great interest in the universities and, of course, elsewhere.

The hon. and learned Lady takes a little refuge in the particular of not being able to reply to specific questions, but I am sure that she will agree that some of these matters are of general importance and have a United Kingdom-wide effect, as the Human Rights Act 1998 will apply in all parts of the United Kingdom. What action could she, please, take to ensure that hon. Members and the public are fully briefed on how the Government—for whom she speaks on the matter—understand the implications of implementation, so that Parliament itself can understand the problems that it will face?

If the hon. Gentleman would like me to provide a little human rights course for him and other hon. Members, I would be delighted to do so. I have made it perfectly clear that I am more than happy to meet individual hon. Members—or groups of hon. Members; however they wish—to discuss these matters. I also have regular meetings with Ministers and with the lawyers across Whitehall. I assure hon. Members that lawyers in Whitehall and in the wider community are very much aware of the convention's implications, and that action is being taken to ensure that lawyers are ready for the convention when it is in force in the United Kingdom.


What steps she is taking to anticipate the incorporation of the European convention on human rights into Scots law in October. [121892]

Since last year, I have spoken to many groups on those issues. As my hon. Friend will be aware, the Scottish Parliament and Scottish Ministers are already bound under the Scotland Act 1998 not to breach convention rights.

My hon. and learned Friend will be aware that the incorporation of the ECHR into Scots law in respect of the actions of the Scottish Executive and the Scottish Parliament has already given rise to a substantial number of applications to the court, including an important current case. What steps are being taken to ensure that the lessons learned in Scotland are disseminated among the Departments of the UK Government that still have responsibility for reserved matters for Scotland?

There have been approximately 650 devolution issues covering a range of subjects intimated to me as Advocate-General. As part of the procedures that I introduced, we have taken steps to ensure that UK Departments are well aware of the issues, the problems and some of the solutions available. I appeared last week in the current court case that my hon. Friend mentioned and I shall appear again tomorrow.

Lord Chancellor's Department

The Parliamentary Secretary was asked—

Licensing Justices


What discussions he has had with the Secretary of State for the Home Department regarding transferring the licensing justices' powers to local authorities. [121894]

The Lord Chancellor's Department has been fully engaged at both official and ministerial level in discussions between Government Departments relating to all the proposals contained in the Home Offices's White Paper on modernisation of the licensing laws.

I thank the Minister for that answer. Is she sticking up for magistrates in the interdepartmental warfare? Does she agree that there is real apprehension that decisions about licensing will be politicised, particularly when there is great pressure from chains of so-called superpubs? Does she agree that the magistrates and the police, working together, have unrivalled expertise in dealing with applications, not least in knowing the backgrounds of those who apply for licences, as well as the advisability from a public order point of view of granting applications?

The proposals to transfer licensing to local authorities will ensure a more streamlined approach, uniting alcohol licensing with other aspects, such as public entertainment licensing, which are already the responsibility of local authorities. The lay magistracy will continue to have a significant role, with its jurisdiction to hear licensing matters that breach the criminal law and its role at the appeal stage.

Does not the Minister recognise that many justices will feel that their powers are being eroded by the Government? Is there not a danger of corruption? After the Donnygate scandals involving her party, surely she is aware of the great concerns that transferring such powers to local authorities could lead to a serious risk of justice not being done or seen to be done. Is not that another case of the Government rushing ahead with change for change's sake? Would they not be better to say "If it aint broke, don't fix it"?

The lay magistracy has done a very effective job in undertaking its licensing responsibilities. The proposal to transfer those responsibilities does not in any way reflect any criticism of their work. The lay magistracy will continue to perform important roles in hearing criminal cases involving breach of the law in such instances. It is disappointing to hear the hon. Gentleman once again attacking the role of local government in an important area in which locally elected and accountable councillors may properly undertake the role of issuing licences. The proposals in the White Paper should be welcomed. If hon. Members have views to express, we are always willing to listen to them.

Family Law


What plans he has to make further reforms in the field of family law. [121895]

The Government are pursuing a number of initiatives to reform and improve family law. In particular, we are further considering the issues surrounding the court process for contact proceedings where domestic violence is an issue and the extent to which we can improve compliance with child contact orders.

I am grateful to the Minister for that reply. With the advancement of equal rights for women in all walks of life, is it not an anomaly that, following the breakdown of a relationship, the law tends to discriminate against men by usually insisting on the children residing with the mother and time-limiting the father's access to them? Should not the law be changed to give fathers equal rights and equal time throughout the year to be with their children, in an era when we are seeking to enhance the equality of the sexes and their rights?

I believe that the hon. Gentleman misunderstands the situation. The law does not prescribe that children should live with their mothers rather than their fathers after the breakdown of a marriage. Most divorced or separated couples make their own arrangements for their children. In some cases, it may be possible, and appropriate, for children to divide their time, exactly half and half, between their parents after a divorce. The courts can make joint residence orders if that is in the children's best interests. However, that is often not practical—it might, for example, disrupt the children's education and their social life. It would not be appropriate to require the courts to impose such an arrangement in every case.

Am I right in thinking that those parts of the Family Law Act 1996 that have not been brought into force will now not be brought into force? If so, is it intended that new legislation will be put in place in due course to state the Government's support for marriage, and that it will include such measures as marriage preparation and marriage support?

My hon. Friend is not accurate. Before implementing part II of the Family Law Act 1996, which is the main area of family law that has not been implemented, the Government must be satisfied that the new arrangements for divorce will work. The interim results of extensive pilots, testing information meetings, have been disappointing, particularly with regard to the number of people being encouraged to attend mediation. The final results of the research from the pilots will not be ready until summer of this year, when the Government will consider how to proceed.

Court Fees


If he will make a statement on the level of court fees. [121899]

The Government inherited from the previous Government, and have continued to apply, the principle of full cost recovery, subject to an expanded system of exemption and remission, which the previous Government attempted to remove in its entirety for the Supreme Court and severely limit for family proceedings and the county court. This means that in the present year, £326 million of the £362 million that it costs to run our courts is expected to be recovered from fees.

I thank the Minister for his response. Is he not concerned that rising levels of court fees will deny access to justice to many people, and that the charges probably hit hardest those who are least able to pay and who most need the protection of our justice system? What will the Government do to put the situation right and ensure proper access to our legal system for all citizens?

The Government have expanded the area of remission and exemption for those who cannot afford to pay. That means that more people are able to access courts without having to pay fees. The truth is that it is lawyers' fees and costs, not court fees, that prevent people from getting access to justice.

May I tell my hon. Friend how welcome it is that some people can now obtain a waiver or remission of fees because of their modest means, and how helpful they find it? May I suggest that the notional fees that are waived should be added to the cost of a successful action, so that at least defendants do not benefit from their opponents' lack of funds?

I am grateful to my hon. Friend for that helpful and constructive suggestion. He is right about the effect of exemptions and remissions. As for his interesting suggestion, I undertake to consider it carefully. I can see that it has some merit; I will write to him about it and put a copy of my answer in the Library.

I am told that there was a surplus of court costs over court fees for the year 1997–98. Will the Minister tell the House how much that surplus was, what happened to it and what he believes should have happened to it?

In the past financial year, income fell well below profile—by approximately £8 million. From recollection—I shall write to the hon. Gentleman if I am wrong—only once in the past five years has the amount of fees exceeded the amount anticipated, but that was not a surplus, because there is a system of remissions and exemptions. In the single case where a slight overestimate was made, it amounted, I think, to a few hundred thousand pounds, which, in the context of an overall cost of more than £300 million, is a small sum. The true position is that if the amount of fees recovered exceeds the cost of running the courts, we should reduce the fees.

Crown Courts


What recent representations he has received regarding the closing of Crown courts in rural areas. [121901]

There is no record of any such representations having been received within the past few years.

I am grateful for that reply. Is the Minister aware that as a result of the development of new Crown court facilities in Ipswich, Crown court users in Bury St. Edmunds have been informed that our Crown court may close and that there may be a consultation period? Does she understand that if justice in rural areas is to be delivered and dispensed locally, the Government must ensure that such Crown courts are not closed, and, more to the point, that proposals to close them are not made by her Department?

I understand local concern, but the Court Service, in conjunction with the judiciary and the criminal justice organisations, has been studying ways to make the criminal trial process more efficient and effective. The Court Service has undertaken a major programme of work—the Crown court programme—and its overarching and straightforward objectives are: to reduce the economic cost of crime by reducing the unit costs of a Crown court case to the criminal justice system; to deal with cases throughout the system with appropriate speed by reducing the time taken from committal to sentence or other disposal; and, finally and most important, to meet the needs of victims, witnesses and jurors by improving their satisfaction levels.

Judicial Appointments Commission (Scotland)


If the Lord Chancellor was consulted by the Scottish Executive over proposals to establish a judicial appointments commission in Scotland. [121904]

The Lord Chancellor was aware of the proposals, now set out in a consultation paper issued by the Scottish Executive, to establish a judicial appointments commission in Scotland. This is a matter for which the Scottish Executive has devolved responsibility.

So the Lord Chancellor was aware, but was not consulted. Will experience in Scotland lead the Lord Chancellor to think again about a long-established Labour policy—set aside two years ago—to move away from the secretive, widely criticised current system towards an open and transparent judicial appointments commission? Why cannot we have one?

My noble and learned Friend the Lord Chancellor keeps judicial appointments procedures in England and Wales under continuous review. Over recent years, there have been many developments in procedures, and he is constantly seeking to improve them. That is why he asked Sir Leonard Peach, a former commissioner for public appointments, to conduct independent scrutiny of the judicial appointments and Queen's counsel procedures. Sir Leonard reported that the appointments procedures were as good as any that he had seen in the public sector. One of his main recommendations was that there should be a commissioner for judicial appointments, and that has been accepted by the Lord Chancellor and is being carried forward.

Immigration Adjudicators


What discussions he has held with the Home Office about its policy in relation to recommendations by immigration adjudicators. [121905]

I have not discussed the policy in relation to the adjudicator's recommendations with the Home Secretary. As a matter of law, the Home Secretary has complete discretion whether or not to adopt an adjudicator's recommendation.

Might I persuade my hon. Friend that it would be a good idea to have such a discussion? At present, many adjudicators make recommendations once they have made a finding of fact that a family can support and accommodate itself without recourse to public funds at the time of the adjudicators hearing, although that had not been the case at the time when the entry clearance officer made the initial decision. If the Home Office pursues its policy of not implementing recommendations in those circumstances, many of my constituents who are applying in Islamabad may have to wait more than a year before their cases can be reconsidered, even when all that is at issue is a matter of fact already confirmed by an immigration adjudicator.

But as I understand it, the Home Secretary will act on an adjudicator's recommendation—although only where there are clear, compassionate circumstances that have not been considered and that would merit the exercise of his discretion. One essential element of the Government's reforms and, indeed, the expansion of the immigration and asylum system, is the one-stop appeal. That will give people a chance to raise at the first stage all their grounds for entering or remaining in the United Kingdom. It would thus be more sensible to reconsider any policy on recommendations by adjudicators—if that was needed—only when we have experience of the one-stop appeal process. However, I am grateful to my hon. Friend for raising the matter.

House Of Commons

The President of the Council was asked—

Appointments Commission


How often the Appointments Commission has met; and if she will make a statement. [121909]

The Appointments Commission is an independent body, appointed on 4 May. I understand that it has not yet met, but that it will do so soon.

Are we not getting ourselves in a terrible pickle over this Appointments Commission, which will be advised by a firm of chartered accountants as to the persons who are suitable for membership of the second Chamber? Will it be open to the Appointments Commission, under its terms of reference, to appoint people to the upper Chamber by random selection, in the way that juries are appointed? Is that a bizarre suggestion?

Was not the hereditary principle the random selection to which the hon. Member for Pendle (Mr. Prentice) referred?

Is not the Government's Appointments Commission but a pale shadow of the independent statutory appointments commission that we really need, so as to remove the enormous patronage that remains in the hands of the Prime Minister? At present, he can decide how many peers there will be and the party balance between them. When will the Government respond to the Wakeham commission's proposals on that and on the rest of the report?

Let me remind the right hon. Gentleman that the Conservative party remains predominant in the upper Chamber, with 236 Members. I understand his reluctance to make changes quickly on House of Lords reform. We want to build on the Wakeham report. The independent Appointments Commission is an important first step. If we could arrive at a consensus on the way forward, I hope that we should quickly move to the Wakeham recommendations.

Oral Questions


If she will bring forward proposals to the Select Committee on Modernisation of the House of Commons to place time limits on ministerial responses to oral questions. [121910]

The President of the Council and Leader of the House of Commons
(Mrs. Margaret Beckett)

I have no plans to do so, but I am aware of the need to balance the desire of Ministers to give full replies with the desire of the House to deal with a reasonable number of questions.

Given that, in 1991, each oral question and answer took an average of two minutes and 57 seconds and nearly 19 questions were reached in an hour, but that, in 1999, each oral question and answer took, on average, three minutes and 42 seconds and only just over 15 questions were reached during the time, will the President of the Council consider a time limit, so that more MPs can ask questions of Ministers, extensive wafflers—from the Prime Minister downwards—can be cut short, and the right hon. Lady herself can emerge victorious as the most dextrous and succinct Minister at the Dispatch Box?

I am grateful to the hon. Gentleman, but flattery will not get him anywhere. I simply say to him that there is a balance in these matters, as ever. If he considers the way that questions are asked—not necessarily by someone such as himself, but more widely from those on the Conservative Benches—he will find that questions are often discursive and cover many topics. It is then difficult for Ministers to reply succinctly.

Are Ministers told to keep their answers short?

Would it discourage Ministers from giving very long answers, and their civil servants from preparing essays rather than short answers, if the period between the tabling of questions and their answer was reduced? That would have the additional advantage of making our questions topical occasionally, rather than relating to what was in the news two weeks previously.

I am not sure that what the hon. Gentleman suggests would make much difference from the point of view of topicality, but I know that he has raised this matter before. I believe that it has been suggested to him that he might like to take the matter up with the House authorities in other ways.

Would it not be better if Ministers and hon. Members did not read questions and replies? That would speed matters up and make things much crisper. The problem is that planted questions get planted replies. Unlike my right hon. Friend, many Ministers are incapable of paraphrasing and feel obliged to read out what has been supplied to them. That is a great pity, and detracts from the House.

With respect, my hon. Friend will know that there has long been a tendency in all parties to be more disciplined about what is asked and what is answered. However, I repeat that the pressure in this exchange has been about replies from Ministers, and that it is difficult to answer discursive questions with less than discursive replies.

Parliamentary Data And Video Network


If she will bring forward proposals to the Select Committee on Modernisation of the House of Commons for the adaptation of Committee Rooms to enable hon. Members to use the parliamentary data and video network system during Standing Committee sittings. [121911]

I have no plans to do so. However, the right hon. Gentleman may wish to take the matter up with the Information Committee and with the Chairmen's Panel.

I am grateful to the Minister for that guidance, but I hope that he might think again. The House has made tremendous strides in giving hon. Members access, by means of the PDVN, to a great deal of information that is very relevant to our work, both in the House and in Committee. However, information cannot be accessed in Committee Rooms, even by downloading onto a computer. If we are to hold the Executive to account, we need access to a large amount of data, so would it not be possible for the Modernisation Committee to examine the role of information technology as an adjunct and aid to the work of Committees in this House?

I understand that the purpose of Standing Committees is to hold Ministers to account, and it is clear that members of Standing Committees must listen carefully to debates. There is a case for looking at new technology and how it impinges on our lives, but that is a matter for the Chairmen's Panel.

What progress has been made in improving access to the internet for hon. Members and their staff? Has a decision been made about whether users of the service will be charged?

A lively discussion is taking place on that subject. Hon. Members with constituencies and offices away from London feel disadvantaged, and the Information Committee is looking into the matter.

Westminster Hall


If she will make a statement on the experimental sittings in Westminster Hall. [121912]

The President of the Council and Leader of the House of Commons
(Mrs. Margaret Beckett)

Sittings in Westminster Hall provide valuable opportunities for debates initiated by Back-Bench Members, for debates on Select Committee Reports and for debates on subjects for which we would not otherwise have found time on the Floor of the House. The Modernisation Committee will review the experiment later this Session.

Does the right hon. Lady agree that the sittings in Westminster Hall are putting increased pressure on members of the Chairmen's Panel and on Hansard? Does not the level of attendance at most debates in Westminster Hall suggest that there is very little interest among hon. Members? Is it not time that we thought again and started returning important business to this Chamber, where it belongs?

Of course the sittings in Westminster Hall do put extra pressure on members of the Chairmen's Panel and on Hansard, as any extra opportunity for debates is bound to do. The Modernisation Committee will look at attendance levels, but I do not agree with the hon. Gentleman's suggestion that debates in Westminster Hall are not required. When Westminster Hall was opened as a forum, thereby doubling the opportunities for Adjournment debates, demand for such debates more than doubled.

Is it not strange that the Opposition seem to want to avoid the opportunity to challenge the Executive? One minute they say that they want to question the Executive, but the next they want to eliminate their opportunities to do so.

My hon. Friend is entirely right. The Opposition are always complaining that there are too few opportunities for scrutiny, but they do not seem to want to take them up when we offer them.

Voting Methods


If she will make a statement on proposals for reform of the voting methods of the House. [121913]

The Modernisation Committee is currently reviewing this matter.

Does my hon. Friend agree that it is only stick in the muds and conservatives with a small "c" who are never interested in considering how to reform the behaviour of the organisations in which they work? Clearly, we should consider voting systems and examine whether there are other ways of making voting quicker and more efficient. The last time that the issue came before the House, a complex multiplicity of options was suggested. Instead, we need to examine one or two simple alternatives that might speed up the voting process and make this place work more efficiently.

There is a mood for change in the House, but what is in dispute is the pace of that change. Some Members would like no change whatever, while others are more radical. My hon. Friend is a member of the Modernisation Committee and she will remember that the last time the issue was considered, Members were offered several choices. The best course might be to make two options available—the present system and an alternative—and to ask Members to judge them.

The fact is that Members have considered alternative systems, and the system that we currently use is the one that they prefer. The issue is not just making voting easier. When Members come together during votes, they are able to talk to Ministers. If it were not for the fact that we have physically to walk through the Lobbies, certain Ministers would not be seen in the Chamber at all.

It has been known for people to change their minds. I suspect that there is a mood among some Members for a change on this matter. However, I accept the hon. Gentleman's point that the Lobby provides an important opportunity for Back-Bench Members to talk to Ministers. Ministers may run but, in the Lobby, there is nowhere to hide.

Sitting Days


If she will propose to the Modernisation Committee a more even distribution of the sitting days throughout the parliamentary Session. [121914]

The President of the Council and Leader of the House of Commons
(Mrs. Margaret Beckett)

The Select Committee on Modernisation of the House of Commons considered the parliamentary calendar in its first report of the Session 1998–99. It is something that the Committee continues to bear in mind in its deliberations.

I welcome that reply, because it is not recognised that the House has more plenary sessions than any other parliamentary Chamber in the world. In a few moments, we shall hear a statement from my right hon. Friend the Secretary of State for Defence, but, if the circumstances that have prompted that statement were to occur in September, there would be no such statement. Should we not move away from the situation in which the House is driven by legislation and only sits when there is legislation to consider? Should there not be sittings in the early autumn to allow for parliamentary questions and for parliamentary statements?

I understand the point that my hon. Friend makes. He will know that the issue has been considered continually down the years and from Parliament to Parliament. Proposals for major change have always foundered on issues such as the timing of party conferences and the necessity to make arrangements for them many years ahead. However, unless the House sits every day, there is always the possibility that something untoward may happen when the House is not sitting.

I assure my hon. Friend that we continue to keep the matter under review. However, I say to him and the House that, unless we are able to be more ordered and more efficient in the conduct of our business and in the way that we handle the parliamentary timetable and legislative discussion, it will always be difficult to deal with the kind of issues that he raises.

Even allowing for the fact that the next parliamentary Session may be foreshortened—I understand that today there is speculation that polling day may coincide with a certain first birthday—will the Leader of the House consider whether this year might not be a good one to see whether we can achieve greater consensus across the parties about the timetabling of legislation through the year?

The first that I heard anyone seriously speculate about such issues—at least, they thought they were serious—was immediately after publication of the previous Queen's Speech. The press, who had clearly become rather bored with this Parliament, began to say that it was clearly time for another general election. I have long thought that such speculation had much more to do with the boredom of the press, who want something different to write about, than with anything else.

I certainly concur with the latter part of the hon. Gentleman's remarks. The House needs to reconsider seriously the recommendations that have been made over 10 years about how we programme our discussions to ensure that we scrutinise our legislation well and not dilatorily.

Parliamentary Recesses


What plans she has to ensure that the dates of future parliamentary recesses coincide with school holidays. [121916]

The President of the Council and Leader of the House of Commons
(Mrs. Margaret Beckett)

The dates for schools holidays are already a factor in setting recesses, but other considerations must be taken into account.

Many hon. Members on both sides of the House have children who are younger than, say, those of hon. Members 30 years ago. May I thank the Leader of the House for her genuine efforts over the past two years or so in trying to make parliamentary recesses coincide more with school holidays? However, it was a disappointment to go into the Easter recess as the schools went back from their Easter break. As we know dates of school holidays in the state and private sectors for at least the next 15 months, will the Leader of the House redouble her efforts and her sterling work to try and make those dates coincide with those of parliamentary recesses when feasible?

I am grateful for the hon. Gentleman's kind remarks. It is true that we try hard to make recesses coincide with school holidays. I understand and sympathise very much with all those whose children were back at school in the last recess. Unfortunately, however, the great bulk of school holidays occurred after Easter and it was not possible to combine the variation in school holiday dates with a reasonable length of recess. The hon. Gentleman will appreciate that at least some of his hon. Friends are constantly calling for shorter recesses.

Sierra Leone

3.31 pm

With permission, Madam Speaker, I wish to make a further statement about the deployment of British troops in Sierra Leone.

In my statement last week, I informed the House about British forces' deployment to Sierra Leone. British troops are in Sierra Leone to get British nationals out and help get UN reinforcements in. That is what our troops were sent to do and it is what they will carry on doing as long as is necessary. They are doing that job exceptionally well. British forces in Sierra Leone have secured Lungi airport while UN Forces are building up. Following the attack on the Parachute Regiment last week, they moved light guns ashore and conducted reconnaissance flights to assist in that task.

Separately, British officers are providing military advice to UNAMSIL, the Government of Sierra Leone, and the UN in New York. Our aim is to help the UN create a more effective UN force in Sierra Leone, which can restore peace and order in Sierra Leone and help the Government there re-establish stability.

That strategy is making significant progress. In the past week, we have seen the arrival of capable and effective UN reinforcements through Lungi airport. The Revolutionary United Front has been pushed back by the forces of the Government of Sierra Leone. We have seen Foday Sankoh, the RUF leader, arrested and detained by the Sierra Leonean authorities. That is of significance. He is ultimately responsible for the actions of the rebels whom he leads. His future is for the Government of Sierra Leone to decide, but the RUF must be clear that the violence must stop, and that the peace process must be carried forward. Our longer-term aim is to have a stable Sierra Leone in which rebel fighting forces have been demobilised, with the Government of Sierra Leone in control of the diamond-producing areas.

I should like to inform the House of changes in our military deployments following that encouraging progress in the UN build-up. As I made clear last week, our intention is that UK forces will stay in Sierra Leone no longer than is necessary. Indeed, UNAMSIL is preparing the way for a formal takeover of the UK's role at the airport in due course.

The 1st Battalion Parachute Regiment has played an outstandingly successful role in securing the airport since it arrived earlier this month. However, conditions on the ground are difficult. Living conditions are extremely basic and the environment in which the forces are operating is hot, humid and thoroughly unpleasant. Furthermore, the regiment now needs to prepare for other duties facing it later this year. The Government have therefore decided to replace the 1st Battalion Parachute Regiment, which will start to return to the UK this week, with 42 Commando Royal Marines. That has a practical advantage, as the marines can be sustained logistically from HMS Ocean's amphibious group just offshore. That will enable us to continue to secure Lungi during the continued build-up of UN forces in the period to mid-June, and to do so without ourselves overtaxing the limited infrastructure of the airport.

The changeover will represent the first stage of our plan to withdraw the bulk of our deployed force by the previously announced timetable of mid-June. That recognises the other commitments that our armed forces have, and my concern to avoid adding to the pressures on them. It also demonstrates the utility and effectiveness of the flexible, balanced force that we sent to the region.

Looking ahead to when the main UK forces withdraw, advance elements of the UK-led international military assistance training team, announced by the Prime Minister on 27 March, will be arriving in Freetown very shortly. The training team is part of the Government's wider programme of assistance in helping the Government of Sierra Leone to restore peace and stability after eight years of brutal civil war. The team will provide advice and training to help the Government of Sierra Leone rebuild new, effective and democratically accountable armed forces and a Ministry of Defence in line with the Lomé peace agreement.

I take this opportunity to assure the House that we will also continue to be very mindful of the situation regarding all the detainees—in particular the delicate position of Major Andrew Harrison and the continuing search for the missing aid worker, Alan Smith.

Creating new, democratically accountable armed forces in Sierra Leone is vital to the long-term restoration of peace and security in that country. The UK will provide the majority of the personnel, but the team will be a multinational effort. We are encouraging other countries with an interest in building peace in Sierra Leone to contribute to building it up, as soon as it is safe to do so, to a team about 90 strong.

Given the return to violence by the RUF, we will also be giving the Sierra Leone army access, under the supervision of British officers, to stocks of light weapons and ammunition, if those are needed for operations. The precise distribution of arms and ammunition will be carefully considered in the context of the local political situation and the wider regional issues.

Our armed forces are doing an excellent job, as has been widely acknowledged in Britain and internationally. Our service men and women can be justifiably proud of the job that they have done. What we are now setting in place are the arrangements for our continuing support to the Government of Sierra Leone. Our deployment has been a practical example of British ground forces being a force for good, and has clearly demonstrated the flexible deployment concept that was at the heart of the strategic defence review. We are showing not only that we can deploy forces rapidly in response to a crisis, but that we will withdraw them when we judge that it is right to do so.

In short, our immediate mission remains the same: to secure the airport for evacuation purposes and to allow the reinforcement of the UN contingent. Our assumptions on timing remain the same: the build-up of UN forces between now and mid-June is clearly on schedule. The replacement of the Parachute Regiment by the Marines is a sensible military step, which preserves our capability on the ground for the remainder of this mission, while allowing the Parachute Regiment to return to the UK.

Finally, our commitment to promoting stability and security in Sierra Leone remains the same. Our decision to enhance the capability of the Sierra Leone army is an essential element of that. We will continue to do all that we reasonably can to help the UN achieve its mission, including giving advice and providing logistical support. Britain will continue to stand by the people of Sierra Leone in their search for a permanent peace.

I thank the Secretary of State for giving me prior sight of the statement, even though it was difficult to obtain a copy until shortly before he spoke. He will forgive me if some of my questions have already been answered.

The Opposition are proud of all that our armed forces have been asked to do and of what they achieve. Whatever they are asked to do, we will continue to support them. The situation was brought home to us last Wednesday, when we had a clear reminder—if any reminder were necessary—of how dangerous the situation in Sierra Leone is. We were also reminded how good our troops are when they came under fire, as the Secretary of State said, apparently from members of the Revolutionary United Front. Our troops behaved impeccably, drove away those fighters and, it seems, killed four of them. We understand, and I hope that the Secretary of State will confirm, that the people who took them on were not drug-crazed youngsters blazing away, but efficient, reasonably well trained and well armed troops. It is important to point that out, as it reminds us all the more how good our troops are.

We welcome the announcement of the withdrawal of the Paras. It must have been pretty miserable for them to sit in the airport in those conditions. We recognise that that consideration must have contributed to the MOD's decision, and we welcome that as well. Our thoughts are with the families of those Paras and all the others who are serving out there: it must be a difficult time for them, as they do not know when they will see their menfolk—or their women—again.

I welcome the Secretary of State's decision to make the statement. It is clear that things are moving fast in Sierra Leone. We called for statements, and the fact that the Secretary of State has responded is cause for congratulations.

Our position is also clear, and has been from the word go. We have always been worried, and continue to be worried, that without enough clarity—without a clear mission and simple tasks—we risk being sucked into a longer-term engagement that will chase events rather than controlling them. To an extent the Secretary of State faced that fact today, and gave answers to some of the questions that have been raised. We will, however, continue to support our armed forces. As the Secretary of State knows, more than a week ago we made a clear offer to support them and, if they are called on to do even more—to take a more aggressive stance in dealing with the RUF to stabilise the situation—to support the bringing in of the United Nations if necessary.

The statement raises questions which, at first glance, require answers. The Secretary of State spoke of the way in which rebel forces had been demobilised, with the Government of Sierra Leone controlling diamond producing in the long run. That seems to differ from what the Foreign Secretary has said in the past about arrangements in the Lomé agreement to establish who controls the diamond fields. Will the Secretary of State explain exactly what that means?

The Secretary of State spoke of other duties later in the year for our armed forces. Will he also explain exactly what that means? The reference seems somewhat open-ended, and I am not sure how it will work in practice. The right hon. Gentleman referred to military advice, and to advisers' being fully in place to advise and train Sierra Leone armed forces. There is a clear sense that that has already been announced: we knew that those advisers were being put in. I wonder why the Secretary of State felt it necessary to reannounce it. Are we talking about a greater number of advisers, or about an expansion of their role?

Back in March, a $16 million aid package was announced for just such a training scheme. Perhaps the Secretary of State could check with the Foreign Secretary, and ask what happened to that package. Was it sent, has it been used, or is it still part of the new package that the Secretary of State has announced? Furthermore, the commitment to the UN seems to run counter to the Foreign Secretary's assurances that we were not becoming embroiled in the workings of the UN in Sierra Leone. Surely the mission has changed in that respect: it has not remained exactly the same.

Let me now deal with questions concerning the Sierra Leone army, and the Secretary of State's announcement that we will provide it with arms. How will the MOD control the way in which those arms are handed out? We already know that there are at least five separate militias—a sort of alphabet soup of shifting allegiances. It is very difficult to track the way in which those militias work with, within or without the SLA. We know that last night members of the Armed Forces Revolutionary Council were engaged in a vicious fire fight with members of the Government, during which two members of UNAMSIL were shot dead, as well as three AFRC members. That illustrates just how difficult it is to define the clean break between who are members of the SLA, who are members of the militias, who is on the Government side and who is not. If we are not careful, we may risk arming some of the militias, and possibly even passing some arms to the RUF. How will we stabilise the position? What will we do about the militias, and what does the MOD plan to do with regard to the reconstruction of the SLA and the question of being sucked in?

What set tasks does the Secretary of State expect to be in place, so that we can define when we will withdraw British troops? What tasks will be achieved? We need to know exactly how the troops will be withdrawn.

Conservative Members still believe that greater clarity is required about our relationship with Sierra Leone, and whether it is necessary for us to take a more aggressive stance to stabilise the position, to drive back the RUF, and to work with the militias. If so, how will we control them? Will the Secretary of State confirm that that option remains open?

I thank the hon. Gentleman for his unqualified support for British forces. I confirm that the RUF contingent that engaged in a fire fight with elements of the Parachute Regiment last Wednesday was well armed, well equipped and well organised. I thank the hon. Gentleman for his further thoughts for the families of those who are deployed in Sierra Leone. Arrangements are in place to ensure that those families are properly briefed about the circumstances.

I take issue with the hon. Gentleman's comments about consistency. There is no inconsistency in the Government's position. If he compares the statement that I made today with that made by the Foreign Secretary on 8 May, the statement issued on behalf of the Prime Minister on 11 May, and the statement that I made last week, on 15 May, he will realise that our position has been clear and precise throughout.

On the hon. Gentleman's final question, the mission that we asked British forces to complete was set out in those statements: it is to secure the airport to allow for the evacuation of British and other entitled nationals and to permit reinforcement by the UN of its contingent in Sierra Leone. That remains the task in which British troops are engaged. If the hon. Gentleman requires a test for when we will have completed the mission, it is when the UN reaches its authorised limit. More important, the UN will then be in a position to secure the airport for further reinforcements, if necessary, to assume the responsibilities that British forces have undertaken.

The hon. Gentleman referred to the diamond areas and the Lomé agreement. Clearly, it makes sense that we should ensure that the forces of the Government of Sierra Leone are in a position to secure the country which they have a mandate to represent. That includes the diamond-producing areas, which, as my right hon. Friend the Foreign Secretary made clear in his statement, are the source of the instability in Sierra Leone. It therefore makes sense when training the forces of the Government of Sierra Leone to allow them to be properly equipped. That is consistent with decisions that had previously been made pursuant to the Lomé agreement. That is why the training team, which was announced some time ago, will continue its task as soon as it is safe to do that. Frankly, the hon. Gentleman simply underlined the consistency of our approach throughout.

May I apologise to the hon. Gentleman for the late notice of the statement and explain that the "other duties" about which he asked are not necessarily in Sierra Leone. They are the normal duties on which we would expect the Parachute Regiment to be engaged. Given that the regiment was deployed as part of the Spearhead Battalion, it is right that, if possible, it should continue with its normal duties. The changeover allows that.

I, too, offer my support to the troops and their families in the same terms as the hon. Member for Chingford and Woodford Green (Mr. Duncan Smith). I offer my support for the statement not least because the Secretary of State has outlined an identifiable political aim, namely the stability of Sierra Leone, the demobilisation of the rebels and bringing the control of diamonds into the hands of the Sierra Leone Government. That is a substantial political objective. When the Secretary of State says that British troops will not stay longer than necessary, is not the truth that they will have to stay as long as is necessary to achieve those political objectives?

It is also clear that the direction of United Kingdom forces, United Nations forces, the Sierra Leone army and the Nigerian forces is under the control of Brigadier Richards. Why do we not acknowledge that? Why are the Government reluctant to admit that they are doing good? The answer is that to do that would require them to go beyond the original stated purpose of evacuation and securing the airport. On any view, what is happening on the ground is at the very least a flexible interpretation of those original objectives.

There is some relief on the Liberal Democrat Benches that the Secretary of State has now abandoned the fiction that the British forces are not combat troops. Is it not clear that they have enjoyed success precisely because they are ready and capable of combat and because anyone who seeks to interfere with their activities will find that out to their cost?

The right hon. and learned Gentleman is a subtle and sophisticated man, and I am sorry that he resorts to such convoluted reasoning to justify his present position. I used the expression "force for good" and we are proud of our forces and the work that they have done, and continue to do, in Sierra Leone. As regards the right hon. and learned Gentleman's suggestion that I should admit that they have been used as combat forces, we have never had any reservations about that fact. We have made it clear, and my right hon. Friend the Foreign Secretary has said repeatedly, that if those forces were attacked they would defend themselves and the mission that took them to Sierra Leone—the protection of the airport. That is precisely what happened in the early hours of last Wednesday morning. They were attacked and they responded robustly and extremely effectively. There has never been any doubt about that, but we have made it clear that British forces would not become combat troops on behalf of either the Government of Sierra Leone or the United Nations. That has been absolutely consistent throughout and it remains the case today. We are supporting the Government of Sierra Leone and the UN mission by ensuring that the Government of Sierra Leone—consistent with the Lomé agreement—have access to properly trained, properly disciplined forces, which they can use to bring Sierra Leone under their effective control.

Has my right hon. Friend seen the photograph in a British newspaper of a 14-month-old child, whose hand was cut off six months ago? Is not that as good an illustration as any of the crimes and atrocities that are taking place in Sierra Leone? Have we learned the lessons of the past—that any kind of coalition with the rebel forces in that country should be totally unacceptable, that there can be no stability until the rebels are militarily defeated and, therefore, that an international force is necessary? We should be proud of the role that British troops are playing.

I thank my hon. Friend for his observations. Yes, I have seen the photograph to which he refers, and many others like it. An appalling aspect of what has taken place in Sierra Leone is that it is possible that that child lost an arm as a result of the activities of child soldiers on the other side who perhaps are only a few years older. That is why it is necessary that Sierra Leone should return to peace and stability and why it is important that we should assist its democratically elected Government to achieve what was set out in the Lomé agreement in respect of training and equipping their forces to do the job that is clearly necessary to bring greater peace and stability to that country—otherwise we could face the recurrence of such violence, and see more of the appalling pictures to which my hon. Friend refers.

Is it not our duty not merely to pay tribute in the House to the skill at arms of our forces—the Paras and 42 Commando—but to ensure that their achievement is lasting so that they do not have to go back and do it again? I have raised this matter previously with the Secretary of State: what efforts are Her Majesty's Government making to ensure that the RUF is distinctly isolated and not getting any help from over the borders that might help to sustain its activities?

On the point made by my hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith), although I entirely accept that it is right to support the Sierra Leone army and ensure that it is properly supported, several other bodies may be temporarily in alliance, and they may be unreliable. We must ensure that the weapons that we may be providing to the Sierra Leone army do not get into the wrong hands so that we do not find that our forces are shot in the back by people using our arms.

The right hon. Gentleman is right. It is important that we ensure that the achievements our forces have made in Sierra Leone are lasting achievements. That is why I consciously linked the timetable for withdrawal to the prospect of an effective training team, to which, we hope, other countries will contribute, although we will take the lead and provide, I think, the bulk of those who are engaged in the training. It is important that we ensure that they have the means to carry out that training successfully and effectively.

I agree, too, that the RUF must be isolated. The continued detention of Sankoh assists in that process. We want to see him brought to trial. We want to be clear that he should no longer have any influence over the RUF in Sierra Leone. It follows from that that other countries, other forces outside that country, should not have any influence over that particular rebel group.

It is obviously important, which is why I expressed myself in very careful terms, that we maintain a degree of supervision over the distribution of those weapons, but, equally, we need to ensure that the training is accompanied by proper equipment for the forces of the Government of Sierra Leone, which will take on and continue to take on those difficult and dangerous tasks.

The Secretary of State is right to be proud of what our Government and our troops are doing in Sierra Leone, but does he agree that a stable Sierra Leone and Sierra Leone now are legions apart? Stability requires a democratic Government who have the wherewithal to control the whole territory of Sierra Leone. The training of the army is fundamental both to controlling the diamonds, and to having an army that is accountable to that democratic Government and that is not simply one more armed band marauding and ripping up that country. In that context, my right hon. Friend is right to say that it is necessary to ensure that the army of Sierra Leone is properly equipped to take on the RUF, which itself is very well equipped because of the blood diamonds and the weapons that come through.

Will the Government make it clear to President Taylor of Liberia that his role in all this has been outrageous? His use of the profits from the diamond industries is an outrage. It is about time that he, too, cleaned up his act. That message should come not just from Britain but from the whole world community.

My hon. Friend is right to call for stability and for the forces of the Government of Sierra Leone to be properly trained. It is obviously vital that we do not simply create a situation in which we see a repetition of the appalling events that we have witnessed over recent times—but the situation today, thanks to the efforts of British forces and others, is unrecognisably different from that three weeks ago. By securing the situation in and around the airport and in particular by giving extra confidence to both the forces of the United Nations and the Government of Sierra Leone, British forces have made a considerable impact on the ground, which I am confident we can take forward through the training arrangements that I have described.

It is also important that we take that forward in the context of international pressure, as I indicated earlier. Pressure must be put on all those in the immediate vicinity to desist from any actions or activities that might lead to further instability in Sierra Leone. That means in particular the immediate neighbours of Sierra Leone itself.

Does the Secretary of State accept that we all praise the work of the British forces and that many of us wish the Royal Marine Commando who are going in the best of good fortune, but does he know of last night's statement by the Minister of State, Foreign and Commonwealth Office, the hon. Member for Neath (Mr. Hain), to the Select Committee on Foreign Affairs about the application by President Kabbah to the British Government, after the death of the Nigerian senior officer Maxwell Kobe, for Britain to supply a British officer to take the place of that Nigerian officer, who had been co-ordinating the military forces? Was the Secretary of State informed of that application? Did he have any input into the decision making before civil servants at the Foreign Office turned it down?

I am grateful for the right hon. Gentleman's observations about the Royal Marine Commando. I am sure that those forces will be delighted to leave HMS Ocean, to get on to the ground and to continue the excellent work that has been done by the Parachute Regiment. We have had a number of requests from the President of Sierra Leone and, as I said in my statement, we have been able to accede to certain of them. We certainly want to ensure that we are in a position to give effective advice, but we recognise above all that it is for the Government of Sierra Leone to sort out their own affairs and to ensure that they have effective forces at their disposal with which to control Sierra Leone.

My right hon. Friend will know that our troops have carried out a very effective but limited operation, although the attainment of the broader political objectives that he set out will be formidably difficult to achieve. He must be aware—anyone who knows the history of Sierra Leone will be so—that very infrequently has the writ of central Government extended far beyond Freetown and Lungi. Does he really expect the Sierra Leone army, given its degree of fragmentation and lack of morale, even with the light arms that we will supply and the United Nations, to be able to inflict such a decisive military defeat on the RUF that it will not be able to move into Liberia and regroup, creating a continuing state of turbulence? Will he not underestimate the enormous degree of difficulty in attaining that laudable objective of peace of security which he has set out?

My hon. Friend referred to the effective and limited objective. It has been the Government's position throughout to ensure that British forces were deployed in order to achieve a particular and specific objective. My right hon. Friend the Foreign Secretary made that clear in his statement. The Government's position has remained absolutely consistent.

That is why it is important that I have linked the prospect of a withdrawal of British forces to the question of an effective training team in Sierra Leone which, working on behalf of the forces of the Government of Sierra Leone, can provide appropriate advice, assistance, equipment and logistical support to carry through what I accept and agree is the much more difficult process of bringing the remainder of the country under control. British forces have contributed significantly to the very early stages of what I recognise will be a difficult process for the Government of Sierra Leone.

Does the right hon. Gentleman understand that, despite the statement, there remains continuing anxiety about the nature, scale and length of the commitment? Does he also understand that, although we welcome statements, they are not a substitute for a full debate on a substantive motion? Will he therefore provide such a debate on our military and political commitment in Sierra Leone? Does he understand that many of us feel that the practice ought to be changed so that, whenever there is a substantial deployment of British forces overseas, the authority of this House is sought and obtained on a substantive motion?

I am grateful for the first part of the right hon. and learned Gentleman's comments. I do not accept, however, that there has been the slightest anxiety about the scale of the deployment. The deployment of HMS Ocean and the Amphibious Ready Group was one matter that attracted comment, yet the reality, as I hope I have demonstrated today, is that their presence on the scene has given us the necessary flexibility to allow the changeover that I have just described.

So, notwithstanding the right hon. and learned Gentleman's anxieties, the deployment of that force—considerable, I recognise, but nevertheless one that has been used and has been useful—which simply initially contained elements in and around the airport, was a substantial undertaking. The airport area is 4 miles in radius—a significant area in which to control the activities of those who might threaten the security of the airport and landings by a variety of aircraft.

We have required a substantial force. Our forces have used it very effectively, and continue to do so. The reason for the size of the contingent was specifically to provide the flexibility of which we are now able to take advantage.

I am sure that the right hon. and learned Gentleman's request for a debate will have been heard by those who are responsible for such matters, and that he and his colleagues can pursue it through the usual channels.

My right hon. Friend has restated that the British forces are acting in support of the UN mission. Does he believe that the UNAMSIL mandate is sufficiently widely drawn to allow the UNAMSIL force to be proactive in protecting civilians in Sierra Leone and in helping to build a stable civil society there?

I am confident that the mandate is sufficiently robust to allow that. I recognise what the UN mandate is, and we continue to look carefully at it and consider whether it is in need of any improvement. We are absolutely confident at present that there is a sufficient mandate to allow UN forces to carry out the tasks for which they are responsible.

Does not the permanent Joint HQ Northwood deserve warm congratulations on having put together a particularly well-balanced force, with the appropriate range of capabilities?

I should like to put to the Secretary of State the question that he did not answer on 15 May. First, who is paying for this British deployment, in the first instance to extricate British nationals? Secondly, who will pay for the further involvement: the support of the UN, logistically and otherwise, perhaps over many months; the provision of the training teams; and the provision of armaments to the army of Sierra Leone? These are very serious engagements, which may not have British popular approval for very long, particularly if they are expensive to the taxpayer.

Ultimately, of course, it is the British taxpayer who will be responsible for meeting the cost of British forces in Sierra Leone. That has always been the position. We have armed forces to protect our immediate domestic interests, but also to operate as a force for good around the world. British taxpayers support that position, and have always done so.

As regards the UN, the hon. Gentleman knows full well that we make a regular commitment to the United Nations, and the cost of UN peacekeeping is paid for out of that.

The provision of training teams is part of a package of assistance to Sierra Leone that we announced some time ago: it is part of the continuing support that the British Government have given to Sierra Leone—support unmatched by any other country in the world.

There have been extensive reports that the bandits are using United Nations insignia and uniforms. One of the long-established principles of war is that it is a serious offence to wear the battledress and insignia of one's adversaries. Has my right hon. Friend had an opportunity to discuss with others—perhaps my right hon. Friend the Foreign Secretary—whether there should be international measures to jealously safeguard the light-blue insignia of the United Nations, so that it would be made abundantly clear, both in this conflict and in any other, that any infringement and abuse of United Nations insignia would be a very serious war crime?

My hon. Friend consistently points out details of these issues that sometimes I have not thought of. That is certainly one. I take his comments seriously, but in the context of appalling atrocities, some of which my hon. Friend the Member for Walsall, North (Mr. Winnick) mentioned, the wearing of cap badges pales into insignificance alongside the mutilation of small children.

Leaving aside the fact that so far the Leader of the House has rejected Opposition requests for a debate on Sierra Leone, can the Secretary of State tell the House why he did not answer the question of my right hon. Friend the Member for East Devon (Sir P. Emery)?

I wish to associate myself with the congratulations to our defence forces, not just the paratroops, but the Ministry of Defence training team that I met in Freetown in March, who are doing nothing less than redesigning and recreating a democratically accountable army in Sierra Leone. On the success of its work will depend the success of the mission.

May I associate myself with the words of my hon. Friend the Member for Manchester, Central (Mr. Lloyd)? Unless we tackle the issue of Liberia, which has supported the RUF for nine years—this is associated with control of the diamond fields—we shall not achieve the objective. I realise that my right hon. Friend cannot tell us exactly what is happening about that, but we must put every pressure on President Taylor to stop the work that he has been doing.

I can assure my hon. Friend that we are doing so, but I congratulate him on putting the problems of Sierra Leone into the appropriate international and regional context. It is clearly important that we take diplomatic and political action, as well as military action, to ensure that the pressure to which he referred is successful.

In offering support for the Government's strategy in Sierra Leone and for the work of our armed forces, I would also ask the Secretary of State to give some further details to the House on the type of supervisory role that would be envisaged for British personnel in the distribution of arms to the Sierra Leone army to guarantee that they are used to reduce conflict, not to intensify it.

The hon. Gentleman is right to highlight that point and we are considering carefully the precise circumstances in which the arms will be distributed. As I said in my statement, there will be an appropriate degree of supervision.

My right hon. Friend knows that when the British soldiers were attacked the other day they were with Nigerians, and the Nigerians have been working effectively alongside our armed forces in Sierra Leone. Will my right hon. Friend take this opportunity to pass on from the House to Nigeria and the other countries in the region, as well as to India, Jordan and the other countries that have supported the UN efforts, our best wishes to all those personnel who are doing such a vital job?

My hon. Friend is right to place what is happening in Sierra Leone in an appropriate regional context. The forces of Nigeria have made a tremendous contribution in the region and have sustained significant losses in the process. It is important that we pay proper tribute to the efforts that they have made and continue to make, and to the fact that they are still willing further to reinforce their contingent in Sierra Leone as a contribution to the efforts of the international community.

I wish to communicate to the Secretary of State an offer about which I have also written to him. It comes from my constituent, Mr. Shakib Basma of Wilmslow, who happens to be a prominent Freetown barrister and is the owner of a disused holiday village some 25 miles from Freetown that might make an ideal British base with the capacity to accommodate 500 men. So impressed is Mr. Basma with what the British have done that he wishes to offer the facility for no fee. I hope that his offer will be seriously considered and that he will be thanked for his patriotic offer.

I am grateful to the hon. Gentleman for that offer and I am sure that it will be considered with appropriate care.

Under what precise circumstances would the Government be prepared to provide combat troops to the UN force in Sierra Leone?

I have made it clear throughout, as has my right hon. Friend the Foreign Secretary, that British forces would not be deployed in a combat capacity on behalf of the UN in Sierra Leone.

Points Of Order

4.13 pm

On a point of order, Madam Speaker. I refer to Home Office questions yesterday, during which my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe) asked the Home Secretary whether he was aware that one of the promoters of the Tyson fight was a man who

has a violent criminal past and has connections with Glasgow's criminal underworld.—[Official Report, 22 May 2000; Vol. 350, c. 656.]
I wish to make it clear to the House that the man in question is not a co-promoter. There is only one promoter and that is Sports Network. The man is one of my constituents and his family and friends, who were very upset by the allegations, contacted me to say that he is a hard-working man with a haulage contractor's business. He gets up at 6 am and gets home at 7 pm. They are very disappointed that he should be so maligned.

To give the House an insight into the type of person the man is, I can list some of the donations that he has made to charities throughout Scotland. He gave £30,000 to Clippen school for the disabled, £9,000 to the Lockerbie disaster fund, £8,000 to a sick children's hospital, £7,000 to Father Bob Gardiner in Easterhouse, and £6,500 to Rev. Galbraith, for Kosovo. He has also paid for a drug addict's funeral and trucked four tonnes of food to Croatia.

That is the kind of man he is. He has connections not with the underworld, but with the underclass. There are many pages setting out the donations he has made and the assistance he has given, including helping the police to take food to Croatia. It is—

Order. I must ask the hon. Gentleman to resume his seat. I am grateful to him. I have more than the gist of his point of order because he indicated earlier the nature of it. As he appreciates, it would not be appropriate for me to comment on the details of the issue that he raises. However, I know that he is concerned about the matter. In the light of that, I remind the House that we have a greatly valued privilege in terms of freedom of speech in this place. I have often reminded the House that with that privilege must go responsibility. It is incumbent on us all to use our privilege responsibly, especially when we refer to people outside the House who do not have a platform from which to respond. We must keep in mind the balance between our privilege and our responsibility when making comments.

I can hardly allow a further point of order when I have already given guidance on our behaviour. However, I shall hear the hon. Lady.

Thank you, Madam Speaker. Of course I take note of the guidance that you have given. I merely wish to say, in case anyone is unaware of the position, that when I spoke yesterday I did not name names. I have no intention of naming names.

On a point of order, Madam Speaker. Due to the entirely inadequate response—it was a non-reply—to my question from the Secretary of State for Defence, I give notice that I will raise the specific matter on the Adjournment as soon as possible.

On a point of order, Madam Speaker. I seek your advice. The hon. Member for Colchester (Mr. Russell) failed to be present for Question 26 to the Parliamentary Secretary, Lord Chancellor's Department. The question concerns the courthouse in Colchester, which is of great importance to people in mid and north Essex.

Do you, Madam Speaker, believe that when Members fail to turn up to pose a question they have won in a selection process that that is discourteous to you, to our constituents and to the House? Did the hon. Gentleman notify you in advance that he would not be present for his question? If not, do you think that you are owed an apology?

I am sure that all hon. Members are aware that from time to time Members are not in their places to put questions that have been tabled. That does not show very good manners to the Minister who has to answer the question, to the Chair or to the House itself. However, a Member is often unable to be present for outside reasons. Members normally come to the Chair when they arrive in the House to apologise when they are late, or I receive a note from them. A Member apologised to me today because his train was an hour late. These are not political point-scoring matters. I understand that for many reasons Members on both sides of the House often find it impossible to get here and impossible to withdraw their question in time.

On a point of order, Madam Speaker. I wonder whether you can help me and other Members, who I fear may be in exactly the same position, by giving some advice on how one can secure timely answers from Departments without every time asking you for an Adjournment debate.

I have a sad and urgent case involving two of my constituents, Mr. and Mrs. Money of Corby Glen in Lincolnshire, and their son David, who has been seriously handicapped from the age of six months following inappropriate vaccination. The family have been waiting for compensation for a long time. I wrote to the Under-Secretary of State for Social Security on this matter on 22 February. There has still been no response despite many attempts to get one. The Halifax bank is about to dispossess the family from their house because they cannot pay the mortgage. They have been waiting to no avail for compensation, or even a response, for a long time.

The hon. Gentleman may be aware that some weeks ago I raised such issues with the Cabinet Secretary and the Minister for the Cabinet Office. I used my best endeavours with those two individuals. I know that they are taking all steps to try to improve the situation. The fact that the hon. Gentleman has raised his point of order may speed things up.

Genetic Testing (Consent And Confidentiality)

4.20 pm

I beg to move,

That leave be given to bring in a Bill to require that genetic testing and genetic test results and other information derived from such tests may be used only for medical and clinical purposes, after informed consent of the patient has been given; to prohibit the giving of such information to other parties; and to prohibit insurance companies, banks, mortgage providers and employers from requiring genetic tests to be taken or insisting on disclosure of the results or of information derived from such tests.
Hon. Members will be aware that genetic science is proceeding apace, that completion of the human genome project is not far away, and that it will soon be commonplace for genetic tests to be available for a variety of conditions. Currently, however, genetic testing is still in its infancy. Moreover, some genetic diseases are multi-factorial—meaning that, although a gene may predispose one to a disease, other environmental factors, such as diet and exercise, influence whether one gets it. To date, the scope of the Government's concern seems to have been to ensure that any genetic tests employed can be said to be accurate and appropriate for use by genetic companies—in short, that the tests detect what they are said to detect.

It is generally agreed that medical records and medical examinations may appropriately be used by insurers in an assessment of risk. Such information is historical, recording previous illness, disease and disability which it seems proper to take into account in deciding insurance premiums. Conversely, genetic testing looks forward, trying to establish what will happen. Many genetic diseases are currently not treatable. Information derived from genetic testing is, therefore, a very powerful matter for the individual concerned. It could reasonably be argued that, in cases of disease with a very poor prognosis, individuals have a right not to know and not to submit themselves to testing.

The problematic consequences of making available the results of genetic tests to insurance companies seem to be threefold. First, there would be the spectre of the creation of a whole underclass of people unable to obtain health insurance, mortgages or loans, and thereby financially excluded from society as a whole. Secondly, compelling individuals to take genetic tests against their will—to discover information that they do not want to know, and that might offer them very little or no medical advantage—seems to undermine the principle of informed consent.

Thirdly, some people who might benefit from appropriate medical intervention might be dissuaded from taking genetic tests because the information from the tests might later be made available to insurers. That concern goes over much of the ground that has been covered in previous debates on human immune deficiency virus and acquired immune deficiency syndrome.

The Association of British Insurers has in place a moratorium on the use of genetic testing. Regrettably, however, not all insurers are observing the moratorium. There have been exchanges between some of the campaigning pressure groups and the ABI on the conduct of specific companies. It is also worth remembering that 5 per cent. of insurance companies do not even belong to the ABI or recognise its code of conduct. It is also clear that many of the companies that do recognise the code are requesting the declaration of all medical tests that have been undertaken, rather than restricting themselves in the matter as they are supposed to do.

The danger is that less scrupulous companies which ignore the voluntary code of practice will cherry-pick individuals who are low risk and offer them low-premium products. So far, only one company—Virgin—has pledged not to use genetic test information, for ethical reasons. As I said, however, the main argument is that although genetic tests may show a predisposition to a particular disease, they are absolutely uncertain in suggesting that an individual will necessarily get that disease.

Other countries have recognised the problem and are taking action to deal with it. In Australia, insurers are not allowed, for example, to ask for an applicant's age. In Sweden, there is an agreement between the Government and the National Federation of Swedish Insurers stipulating that insurance companies may not require either family medical history or genetic results to be disclosed by the applicant. There are legislative restrictions in a number of other countries, including Austria, Belgium and Norway, as well as in 18 US states, while Australia, France, New Zealand and the Netherlands have voluntary agreements.

The Government are putting too much faith in the ABI and its code of practice. The Government set up an earlier commission, which reported in November 1998 and recommended a ban. Unfortunately, the Government did not accept that recommendation entirely and set up two subsequent commissions, both of which I welcome, to look into the two aspects of the issue. One is considering the practical aspect of whether particular tests are accurate and satisfactory; the other is just beginning its work on ethical and social considerations. I regret that the Government have not introduced at least a temporary ban while the two commissions are doing their work. I also regret that the Government do not appear to have considered the public health aspect of the problem. They do not even seem to have put in place measures to monitor how many people will decline genetic tests because they are fearful of the insurance implications, thereby perhaps imperiling their health and not taking advantage of new procedures that would be available to them.

The ABI code of practice says that applicants will not be asked to undergo a genetic test, that insurers will take account of existing results only if their reliability and relevance have been established, and that they will not interfere with the premiums that they charge unless a genetic test clearly indicates an increased risk. That should apply only to a limited range of products, but it seems to apply more widely across the board. There are some notable exceptions and it is unfair that those insurers who behave in a controlled and ethical fashion should lose out to those who do not. That is a taste of what is to come if we do not put in place tight regulations that ensure a fair marketplace.

The Alzheimer's Disease Society has been vocal in its criticism of the ABI and the Government's position. Its main critique of the ABI is that it has failed to demonstrate that insurers need to collect information on pre-symptomatic genetic tests. That is an important point. If insurers are not able to get such information, they will be in the same position as they are today. They will not be materially worse off for not having information in the future that they do not currently have. It is incumbent on them to show that the existing insurance markets will fail if the companies are denied such information.

The Alzheimer's Disease Society also points out that insurance companies have yet to demonstrate their competence in dealing with such genetic information or their ability to self-regulate. The society is right to flag up those substantial fears and many people are justifiably concerned.

I am also particularly encouraged that President Clinton has signed an executive order forbidding the United States Federal Government from using genetic information in employment decisions. That will protect all 2.8 million federal employees. President Clinton said:
We must not allow advances in genetics to become the basis for discrimination against any individual or any one group. By signing the executive order, my goal is to set an example and pose a challenge for every employer in America, because I believe no employer should review your genetic records along with your résumé.
That sets out a bold course in the United States and we should do something similar. We should recognise the example of other countries and realise that those scientific advances will soon be with us. The legislative framework within which companies will operate needs to be put in place now, so that when the scientific advances come no one will have any cause for fear or alarm.

Question put and agreed to.

Bill ordered to be brought in by Mr. Nick Harvey, Dr. Peter Brand, Mr. John Grogan, Mr. Martin Bell, Mr. Simon Burns and Dr. Evan Harris.

Genetic Testing (Consent And Confidentiality)

Mr. Nick Harvey accordingly presented a Bill to require that genetic testing and genetic test results and other information derived from such tests may be used only for medical and clinical purposes, after informed consent of the patient has been given; to prohibit the giving of such information to other parties; and to prohibit insurance companies, banks, mortgage providers and employers from requiring genetic tests to be taken or insisting on disclosure of the results or of information derived from such tests: And the same was read the First time; and ordered to be read a Second time on Friday 21 July, and to be printed [Bill 132].

Orders Of The Day

Crown Prosecution Service Inspectorate Bill Lords

Order for Second Reading read.

4.30 pm

I beg to move, That the Bill be now read a Second time.

This is a concise but important measure. Its purpose can be summarised shortly: it places the Crown Prosecution Service inspectorate on a statutory basis. I am pleased to say that, so far, it has received a warm welcome from both sides of the House.

The CPS inspectorate is a non-statutory body, operating within the CPS itself. The current chief inspector and his staff are all members of, or on loan to, the Crown Prosecution Service. They therefore report to the Director of Public Prosecutions. Although the inspectorate has produced valuable work since its inception in 1996 under the previous Government, there is no doubt that the current arrangements are not ideal. It is important that an inspectorate should he not only independent in practice but demonstrably independent. The current arrangements do not necessarily achieve that purpose, which is why we are introducing this Bill.

The Government attach considerable importance to having an effective and efficient CPS. We believe that an important part of building a credible organisation is ensuring that it is subject to rigorous inspection. The Glidewell report into the future of the CPS, published in 1998, reached the firm conclusion that it is essential to retain and expand the role of the CPS inspectorate. It said that public confidence in any organisation is greatly enhanced if it has an efficient and effective inspectorate system, advising those at the top of the organisation as to its corporate health and publishing the results of its work.

Glidewell recommended introducing an independent element to the inspectorate in the form of a part-time independent chairman. I am pleased to say that, in this respect, the Bill goes further than the Glidewell recommendation. The independent chief inspector will occupy a full-time post.

The Bill will guarantee that the inspectorate enjoys the same independence and status as other criminal justice inspectorates, such as the inspectorate of prisons and the inspectorate of probation. Importantly, the inspectorate will be separated from the CPS. It will be financed separately and located in separate accommodation. The chief inspector will be appointed by the Attorney-General, who will have the authority to appoint other inspectors. That is the effect of clause 1.

I intend no disrespect to existing members of the inspectorate, whose work was praised in the Glidewell report, when I say that that change of status will also provide an opportunity to bring into the inspectorate additional staff with a wider range of backgrounds. In other words, there will be staff members whose background and experience are quite distinct from the CPS. A number of outside people have already been appointed as business management inspectors and legal inspectors. They will bring fresh ideas and a different perspective to supplement the existing expertise in the inspectorate. The chief inspector will acquire management responsibility for the inspectorate, again separate from the CPS.

The chief inspector's overriding responsibility will be to inspect the operation of the CPS. That duty is cast in wide terms in clause 2. The clause is drafted to ensure that the chief inspector has independence. He can inspect and report on any matter connected with the operation of the CPS that concerns him. However, the Attorney-General may refer matters to the chief inspector to report on. The chief inspector is thus responsible to the Attorney-General and, ultimately, to Parliament. The chief inspector will have to submit an annual report to the Attorney-General, who is then under a duty to lay that report before Parliament.

A further change to the inspectorate since the Glidewell report is that it now no longer concentrates exclusively on matters of case work. In accordance with the report's recommendations, its remit has been broadened to include all aspects of the CPS operation that support its case work. Inspectorate reports will continue to concentrate on case work, but will also provide a complete overview of CPS performance in the area inspected, including management and operational issues.

The CPS inspectorate will also undertake more inspection work of a thematic nature. It recently published a report on disclosure of unused material, which attracted wide attention. In February, it published a report on advocacy and case presentation. Although that did not attract the same attention, it was important.

Preparation of such thematic reports will continue once the inspectorate is placed on a statutory footing. The chief inspector also proposes that more work should be undertaken with other criminal justice inspectorates. Some such work has been undertaken, such as the joint report by the CPS inspectorate, the magistrates courts service inspectorate and the inspectorate of constabularies, "How Long Youth Cases Take". More recently, the first joint inspection by all six inspectorates with an interest in the criminal justice system has been completed. Their report—"Casework Information Needs Within The Criminal Justice System"—was published at the end of April.

Such joint scrutiny of aspects of the working of the criminal justice system supports the Government's establishment of overarching aims and objectives for the criminal justice system. We are determined that individual agencies should provide a more coherent and effective service without compromising their individual, and sometimes independent, roles.

Clause 2 allows the chief inspector to designate an inspector to discharge his functions when he is absent or unable to act. Clause 3 simply sets out the short title, extent and commencement arrangements.

This is a short, but important, measure. It has obviously gripped the attention of the whole House. I am convinced that it will make a significant contribution to the effective operation of the criminal justice system.

4.37 pm

As the Solicitor-General correctly said, he and I have managed to attract our usual adoring fan clubs to the House this afternoon. I am grateful to those who have come to see us.

The Bill has been described as modest, short and uncontroversial. In some quarters, those epithets might lead people to think less of it, but, despite, or even because of, its brevity, narrow compass and inoffensiveness, it should command the support of the House.

It is perhaps surprising that the Bill has taken so long to get here from the other place. Second Reading in the Lords took place on 30 November last year, when the Attorney-General stated with pride that it was only the second piece of legislation promoted by a Law Officer in 50 years. The first had been a Bill to increase the salary of the then Solicitor-General, the noble and learned Lord Falconer of Thoroton, and any other Law Officer who was a member of the other place rather than this House. Lord Williams of Mostyn said that that was
plainly a piece of legislation of the utmost importance—[Official Report, House of Lords, 30 November 1999; Vol. 99, c. 761.]
Now the Solicitor-General has introduced the second Bill to this House, and the beguiling tones of the Wales and Chester circuit have been replaced by something a little more antipodean. As the House will know, Australia House is just across the street from the London School of Economics.

The Bill itself is none the worse for that. I congratulate the Solicitor-General on bringing to the statute book an idea whose genesis is to be found in the period of office of my right hon. and learned Friend the Member for North-East Bedfordshire (Sir N. Lyell). When he was Attorney-General, the Conservative Government decided that an inspectorate of the Crown Prosecution Service was needed, and there has been a non-statutory inspectorate within the CPS since 1996. Had we been successful at the general election, the Bill, or something very similar, would have been introduced by my right hon. and learned Friend.

It is fair to say that the idea behind the Bill was given further impetus by the Glidewell report on the Crown Prosecution Service, which was published in 1998. As the Solicitor-General told us, once the Bill is enacted the inspectorate will have a status equal to the other statutory inspectorates with which we are already familiar—such as those for prisons, the probation service, magistrates courts and the constabulary. They have proved to be powerful and useful additions to the armoury for public accountability of the public services; I welcome the Bill on that ground alone.

In clause 2, the chief inspector's functions are spelt out in a general fashion. Having been to see the current chief inspector, Mr. Stephen Wooler, in his offices in Ludgate Hill in the City earlier this year, I have no doubt that both he and his staff will carry out their duties well and with great thoroughness and independence. They have already built up an ethos that suggests that they take seriously their responsibilities to the public and to the CPS. They will look into specific issues referred to them by the Attorney-General and they will also, I understand, prepare thematic reports that will flow from longer and more detailed inspections of particular aspects of the work of the CPS—such as prosecution policy in respect of certain types of crime or the use of resources in a particular field of CPS work.

However, may I suggest that one of the first things the statutory inspectorate considers is the current state of morale among CPS staff—lawyers and non-lawyers alike? Is the Solicitor-General aware that, according to a survey carried out by the Association of First Division Civil Servants, the levels of stress-related illnesses among the CPS work force are so high that the association described the CPS as being
on the brink of crisis?
One in four of its 9,000 staff suffer high levels of stress. The proportion of lawyers and administrative staff shown to be affected is greater than in similar findings anywhere in the private or public sector. That comes from a survey that had a 65 per cent. response rate—a remarkable statistic in itself.

The Government propose to cut the CPS budget by almost 5 per cent. next year. I am as keen to see the proper use of taxpayers' money as any Member of the official Opposition, but there are ways and ways of ensuring that the public receive good value for money. The Labour Government's approach to the finances of the CPS appears to be unintelligent, and calculated to have an even more depressing effect on the performance and morale of its staff.

The present Director of Public Prosecutions is an extremely able and justifiably respected criminal lawyer of the first rank. He has not been afraid to appear in cases in the magistrates courts to see for himself the work of his most junior lawyers. From my visits to CPS offices, both as a constituency Member of Parliament and as the shadow Attorney-General, I am aware of the stresses and difficulties faced by the CPS; they need to be addressed speedily and effectively by the Government.

As a recorder of the Crown court, I see the results when ill-prepared cases come to court—the avoidable delays and frustrations for witnesses and other court users, and the general air of hopelessness that often seems to pervade junior and middle-ranking CPS lawyers, who are overworked and under-resourced.

It is incumbent on the Government to get a grip on aspects of our criminal justice system where they can do some real good—as with this Bill—rather than wasting time, money, energy and the good will of the legal profession, and of many others who care for the rights of the citizen, on destroying the jury system by means of the Criminal Justice (Mode of Trial) (No. 2) Bill. I urge the Government to use the Bill for the benefit of the CPS certainly, but, above all, for the benefit of the public by whose interests they ought to be guided.

4.43 pm

If the Bill results in the creation of an independent and autonomous inspectorate, it cannot come into force too soon. I shall refer later to such matters as independence and annual reports, but I must first express my great concern about the state of morale in the Crown Prosecution Service. I endorse wholeheartedly the comments of the hon. and learned Member for Harborough (Mr. Garnier). I, too, pay tribute to the Director of Public Prosecutions. His integrity and independence are not in question.

My awareness of the state of morale in the CPS does not come only from recent newspaper reports; it also results from my discussions with members of the service. Because of their fear of recrimination, I cannot disclose their names to the House; indeed, I have given my word that I shall not do so.

The hon. and learned Member for Harborough referred to a recent independent report. On 20 May, The Times carried an article with the headline "Stressed CPS—Staff Close to Crisis". It stated that, according to the survey published the previous day, the CPS was on the brink of crisis, with one in four of its 9,000 staff suffering high stress levels. The survey had a response rate of 65 per cent., and was carried out last year by an independent organisation. I gather that it was commissioned after a female member of the CPS sadly committed suicide, allegedly because of the stress of work.

The First Division Association is using the survey in an attempt to reverse a 4.6 per cent. cut in the budget for next year. That information is in the public domain, but members of the Crown Prosecution Service have told me directly that there are reasons other than funding for the rock-bottom morale in the service. They say that they lack the most basic resources and equipment for the job.

The House will be amazed to hear that the 10 Crown prosecutors in one team, many of whom deal with road traffic matters, have one textbook to share between them. The support given to the CPS is negligible. I am told that there is also a lack of computer and secretarial back-up. It is very difficult for Crown prosecutors to get up-to-date information on any law. There is no link to Lexis or to any other computer-based information service.

It is a disgrace that the Government should fetter and hamper their prosecution service so dreadfully. It is no wonder that the record of the CPS is criticised so frequently. The service has many very able people, who are dedicated to doing their jobs as fairly and efficiently as they can. How can they achieve that with both hands tied behind their backs?

It makes a mockery of our criminal justice system if the state is not able properly to mount a prosecution. There has been a lot of talk recently about new offences such as corporate manslaughter, but it is useless if there is no confidence that the Crown can mount a compelling prosecution in the first place.

I am told that in the west country, the CPS cannot keep up with its commitments in the magistrates courts, let alone in the higher courts. The House will recall that the Access to Justice Act 1999 gave properly qualified members of the CPS rights of audience in the higher courts. Liberal Democrat Members supported that provision, but I remind the Solicitor—General that the Act made it clear to all lawyers that their first duties are to the court and to the integrity of justice. Many CPS members believe that the underfunding and underresourcing that I have described have put them in breach of the relevant section of the 1999 Act. I understand that, this year, the CPS in Devon and Cornwall must make good a budget shortfall of some 8 per cent.

I hope that the Solicitor-General has something to say to the House on the matters of funding and morale, as the current state of affairs is utterly unacceptable. It makes a mockery of any attempt by the Government to deal adequately with their responsibilities for the criminal justice system. We want the Bill to establish a scrupulously independent and autonomous inspectorate. It must report annually to Parliament. Its chief inspector must come before the appropriate Select Committee after the annual report has been published, and at any other time that the Select Committee may determine.

There should be no inhibition or strictures on any CPS employee contacting the inspectorate at any time to make known the misgivings that he or she may have about the service. Those misgivings do not necessarily have to involve matters of funding or resources; the employees should be able to raise other matters and, most important, to refer to any endeavour by any person to exert undue influence on a Crown prosecutor.

I remind the House that one of the conclusions of the Glidewell report was that it was essential to expand the role of the Crown Prosecution Service Inspectorate and that the inspectorate should have an independent chairman. I welcome the fact that there will be an independent chairman and I welcome the Bill. However, I hope that the Solicitor—General can assure the House that members of the CPS will be free to make complaints to the inspectorate without recriminations. Furthermore, I look forward to hearing from the Solicitor-General that the chairman will be independent and autonomous and will report to a Committee of the House at any time that that Committee should determine.

4.51 pm

With the leave of the House, Mr. Deputy Speaker.

I am grateful for the warm welcome that has been given to the Bill. I thank the shadow Attorney-General, the hon. and learned Member for Harborough (Mr. Garnier), and the hon. Member for Torridge and West Devon (Mr. Burnett) for their support for the principles behind it.

I shall deal briefly with a few points that have been raised in the debate. The shadow Attorney-General said that he had visited the Crown Prosecution Service Inspectorate and I am grateful that he did. I am sure that the visit gave him a greater insight into its operation. He mentioned thematic reports, which the Attorney-General and I have encouraged the inspectorate to carry out. At present, the inspectorate is undertaking reports on the handling of ethnic minority issues, custody time limits and offences arising out of fatal road accidents. I know that they are three issues of concern to both sides of the House.

The shadow Attorney-General and the hon. Member for Torridge and West Devon referred to the recent stress survey. The Government should be commended for undertaking that survey, which produced results that were not exactly unexpected. Prosecutors work under great time constraints, there is a problem of funding—I shall come to that point shortly—and, at present, there is a lack of sufficient information technology facilities in the service. None the less, the report identified the strength of the CPS; the nature, diversity and importance of the work that prosecutors and the non-lawyers in the service carry out and which is appreciated; and the good terms and conditions that they enjoy as part of the civil service.

Let me make it clear that funding is an historic problem. It harks back to the founding of the CPS and the Conservative party cannot avoid responsibility for that. The CPS was underfunded from the outset and it is only now that the position is being redressed.

The Solicitor-General says that the CPS has been underfunded historically, but why are the Government cutting its budget for next year?

I was just about to say that the Attorney-General is making great efforts in putting the case to the Treasury for an increase in funding for the CPS. That case has been supported by the Lord Chancellor and by my right hon. Friend the Home Secretary, who both understand that an effective CPS is necessary if other parts of the criminal justice system are to work. At present, I cannot tell the House the outcome of those negotiations, but I am optimistic that there will be good news in the near future.

Are financial deficiencies carried forward from previous years included in the discussions and representations of the Home Secretary and the Chancellor?

As I said, the problem is historic. The previous Government underfunded the CPS and we have a lot to make up. The hon. Gentleman mentioned information technology, which is one area in which we have made progress. As I have told the House before, we successfully obtained an extra £12 million in the capital modernisation programme and, as a result, the Connect programme will be implemented later this year. It will provide all prosecutors with basic information technology, and will enable the CPS to access databases and send e-mails via the internet to other criminal justice agencies.

Will the computer technology that is being funded and installed include Lexis or some other legal information and case law network accessible to Crown prosecutors, enabling them to know the up-to-date law to which they must refer in court?

It certainly will. In the pilot projects, Archbold, the standard textbook on criminal law, is available to prosecutors.

I refute the view that morale is at rock bottom. Certainly, that was not the case in Derbyshire and Hertfordshire, where I visited CPS officers last week. I did not conclude that morale was at rock bottom when I visited the Devon and Cornwall CPS last year with the hon. Gentleman. No doubt, there are stresses and strains and the situation could be improved, but the bleak picture painted by Opposition Members does not reflect reality.

In response to a point made by the hon. Gentleman, there is no reason why the CPS inspector should not appear before the Select Committee on Home Affairs. Indeed, in relation to the independence of the CPS, all prosecutors are fiercely independent and must act in accordance with the statutory code for Crown prosecutors.

Will individual members of the CPS have access to the inspectorate so that they may discuss anything that is germane to their job in the service?

The chief inspector's main function is to ensure that the quality of work is up to standard. However, as he goes round different areas, I am sure that individual prosecutors and others will have an opportunity to raise and discuss matters with him.

The Bill goes considerably beyond the recommendations in the report by Sir Ian Glidewell. I believe that the statutory inspectorate will continue to develop within the framework established by this simple measure. Of course, it is of paramount importance that the CPS gains increased public confidence. However, an open, accountable and vigorous inspectorate will go a long way towards developing that confidence.

Question put and agreed to.

Bill accordingly read a Second time, and committed to a Standing Committee, pursuant to Standing Order No. 63 (Committal of Bills).

Crown Prosecution Service Inspectorate Bill Lords Money

Queen's recommendation having been signified—

Motion made, and Question put forthwith, pursuant to Standing Order No. 52 (Money resolutions and ways and means resolutions in connection with bills),

That, for the purposes of any Act resulting from the Crown Prosecution Service Inspectorate Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of—
  • (1) sums in respect of salary, pension, allowances and compensation for Her Majesty's Chief Inspector of the Crown Prosecution Service; and
  • (2) expenditure incurred by the Chief Inspector in the discharge of his functions under the Act.—[Mr. Dowd.]
  • Question agreed to.

    Limited Liability Partnerships Bill Lords

    Order for Second Reading read.

    4.59 pm

    The Parliamentary Under-Secretary of State for Trade and Industry
    (Dr. Kim Howells)

    I beg to move, That the Bill be now read a Second time.

    The creation of limited liability partnerships adds to the variety of business entities available to those wishing to set up in business in Great Britain. Firms can usually choose between being a company—which is good if one wants a split between ownership and management—and being a partnership, which is good if one wants greater flexibility in arranging the internal affairs of the business and does not mind unlimited liability. However, firms will now have the option of becoming a limited liability entity with the internal flexibility of a partnership.

    Limited liability partnerships, or llps, were first proposed by the previous Administration, and responses to a consultation on the general principles were clearly in favour of their introduction. The Government agreed that the concept had merit and published a draft Bill in September 1998. That, too, was well received, and consultees provided feedback on the detail of the legislation. I should add that consultees represented a wide range of interests, including accountants, lawyers, actuaries, architects, surveyors, academics, trade associations and those representing the potential clients of an llp. The measure has wide support across the professional business community.

    The Bill was subject to pre-legislative scrutiny by the Select Committee on Trade and Industry. The Committee's comments were a valuable contribution to the development of the Bill.

    To explain the way in which we have chosen to construct the llp, I need to say something about where the idea of limited liability partnerships comes from. In 1996, the Department of Trade and Industry published for consultation an authoritative investigation by the common law team of the Law Commission into the law of joint and several liability, a complex area of common law.

    The report examined the problems that resulted from joint and several liability for professional defendants. For example, defendants might find themselves liable for the whole amount of the damage caused to the plaintiff, even where other wrongdoers were involved. However, the report concluded strongly against any reform of the law of joint and several liability. The main reason was that a change towards a system of proportional liability would favour the wrongdoer at the expense of the plaintiff. This is a simplified summary of the report's detailed conclusions.

    The common law team's remit did not extend to looking at joint and several liability in partnerships, but the Department of Trade and Industry at the time took the opportunity to consult on the question whether to allow for llps in Great Britain.

    Llps were already a well-known concept in the United States of America, and Jersey—not New Jersey, but Jersey in the Channel islands—was also planning to introduce them. As a result of the process of consultation, we concluded against any reform to the law of joint and several liability, but gave our commitment to the introduction of limited liability partnerships.

    Surprisingly, there has been no fundamental change to business entities in Great Britain since 1907, when the Limited Partnerships Act was introduced. Only a company offers all its members limited liability, which perhaps seems a little odd in the 21st century. The creation of llps demonstrates the Government's commitment to ensuring that Britain maintains its competitive and up-to-date legal framework for business.

    The development of llps takes account of the changing business environment, which has become increasingly litigious in recent years. The structure of an llp means that some firms may find it an advantage over a company, as it offers the freedom for members to arrange their internal relationship to each other and to the llp as they wish, while having the benefit of limited liability. That is likely to be popular with those who already have partnerships, but it may also prove to be of some benefit to start-up businesses.

    I am grateful to the Minister for giving way. I shall refer to this in my speech, if I am fortunate enough to catch your eye, Mr. Deputy Speaker. The Minister says that the limited liability partnership will be useful for other businesses. Will it be useful for other incorporated businesses? If so, it would be a lot more useful for incorporated businesses—that is, limited companies—if the tax penalties on disincorporation were eased.

    I hope that the hon. Gentleman will bear with me. I shall deal with tax separately and in some detail, as it is a crucial component of the Bill.

    In November 1999, the Bill was introduced in another place, where there was wide support for the concept. That is not to say that the Bill's passage through the other place was uneventful. A lively and useful debate took place, and the Government made a number of amendments, with which I shall deal later.

    I am pleased to say that the Bill is in very good shape, and I thank Members of the other place for their contribution to bringing that about. We believe that the right balance has been struck between the interests of those who will want to be llps and of those who will do business with them.

    Although the new entity is called a limited liability partnership, in many ways it is neither fish nor fowl. In some respects, it is closer to a partnership, while in others it is closer to a company. That hybrid quality has been at the root of most debates on the measure, with some wanting the entity to be allied more closely to a partnership and others wanting it to be allied more closely to a company.

    We had to strike a balance. While members will be free to agree among themselves, their relationship being rather like that of members of other kinds of partnership, the llp itself will be a separate legal entity, owned by the members. That means that it will be able to enter into contracts, hold property and continue to exist independent of changes in membership. In that sense, llps will be closer to companies than to partnerships. We will therefore apply to llps, by way regulation, appropriately modified companies legislation—for example, the Companies Act 1985, the Insolvency Act 1986 and the Company Directors Disqualification Act 1986.

    The limited liability of the members is also clearly more closely akin to the position of a company than to that of a partnership. Limited liability is a privilege, and we need to ensure that it is not abused. The companies and insolvency legislation will help to do that.

    Clause 6 makes it plain that a third party dealing with an llp will be entitled to rely on the fact that the member is an agent of the llp, but because the llp is a separate legal entity, we expect the third-party contract to be with the llp rather than with the member. That mirrors what happens in the case of companies. It is anticipated that, in the event of a claim for negligence, the claim would be against the llp rather than the member.

    I thought that an overriding principle of the Bill was that a member who conducted work for an individual client would be liable to the extent of the entirety of his assets, if he was found to be negligent.

    That is absolutely true. If he is found to be negligent, he will be liable to exactly the same punishments, and to be pursued in the same way, as the director of a company; there is no doubt about that. The llp, however, is the first port of call when there is deemed to be a problem.

    The llp would be liable to the full extent of its assets, but—I think that this is what the hon. Gentleman is getting at—that does not rule out the option of the third party's pursuing the negligent member as well. The third party, however, would only be able to sue the negligent member in tort, as the contract would have to be with the llp. Tort liability may be much more difficult to prove.

    Clients of the llp will need to be made aware of the nature of the entity with which they are dealing. To help ensure that, firms using the abbreviation "llp" after their names will have to mention on their business letters and order forms that the letters stand for "limited liability partnership".

    The Bill also requires that two or more people must be associated for the carrying on of a lawful business with a view to profit, and that their names must be on the incorporation document. The limited liability partnership and its members must be registered at Companies House. Its records must be kept up to date. The llp must also have two designated members whose responsibilities include filing the annual return, notifying Companies House of changes in membership and of any change to the address of the registered office.

    Taxation is the other main subject of the Bill. The hon. Member for Torridge and West Devon (Mr. Burnett) asked about that. The Bill expressly provides for llp to be taxed as though they were partnerships. Without such provisions, they would be taxed as companies because, elsewhere, the Bill provides that they are corporate bodies. Although llp will be corporate bodies, they will retain the partnership ethos at their core. Like partnerships, llp will consist of members who are involved in running the firm. We anticipate that they will continue to be an important source of working capital. It was therefore agreed that it was more appropriate for an llp to be taxed as a partnership than as a company.

    Several amendments were tabled to the tax provisions in another place. They were technical amendments, which were intended to ensure that the legislation achieved our objectives more effectively. One amendment was intended to apply sections 117 and 118 of the Income and Corporation Taxes Act 1988, with appropriate modifications, to llps. The purpose was to ensure that they could not be exploited for specific forms of tax avoidance. That would have involved members of llp being able to obtain tax relief for a loss sustained beyond their personal obligation to meet it.

    Amendments were also made to ensure that the transfer of partnership assets from an existing partnership to an llp would be tax neutral. We thus maintain our policy of ensuring tax neutrality when conventional partnerships transform themselves into llps.

    When the Minister considers tax neutrality, I hope that he will refer to the possibility of limited liability companies becoming llp. Will he also confirm that, when he says that the transfer of a business or partnership into an llp will be tax neutral, it includes stamp duty?

    I shall find out by the end of the debate. I believe that the provision includes stamp duty, but I shall confirm that later. Although I appreciate that the hon. Gentleman understands the purpose of the Bill, his initial and follow-up questions suggest a misunderstanding. I do not expect the Bill to be especially useful to incorporated businesses because they already have limited liability and have already organised themselves as a company. There is no reason for them to organise themselves into llps, which will be taxed as partnerships while companies are taxed as companies. I envisage no reason for, or easy way to make, the transformation of a company into an llp tax neutral.

    Members of a limited company might want to become an llp for good tax reasons.

    That would be up to different companies. We hope to provide a new vehicle for companies and business; clearly, the decision would be up to them.

    Another amendment was made to ensure that members were treated for national insurance purposes as if they were partners in a partnership. Although we believe that it is right to tax llps as partnerships, we are aware that the tax treatment may allow scope for llps to be used when the primary or only attraction of llp status is tax treatment. I sense that the hon. Member for Torridge and West Devon was hinting at that when he spoke. Clearly, that is not intended. We shall consider that issue carefully with the Inland Revenue and, depending on our conclusions, measures may be introduced in the 2001 Finance Bill. The Revenue will consult widely on its intentions. It is important to emphasise that we do not intend to undermine the commercial certainty of llps' taxation treatment for those businesses for which llp status was intended. That will be at the forefront of our minds, whatever options are proposed.

    Apart from those on tax, several amendments were made in the other place, the most notable of which included clarifying that an llp's members will not be its employees and putting it beyond doubt that, if an llp member were liable to a person for a wrongful act or omission in the course of the llp's business, it would be liable to the same extent as the member.

    We intend to apply secondary legislation to llps, which will include similar requirements to those for companies; it may be useful if I touch on what that will mean. The regulations will include a requirement for financial disclosure equivalent to that required of companies, provision that members of an llp can be sued for wrongful or fraudulent trading and provision that members can be disqualified from being members of an llp and a company director. The regulations will apply, with appropriate modifications, the provisions of the Insolvency Act 1986. Those modifications include a measure that will deter members from siphoning off funds to the detriment of creditors.

    We have published the draft regulations for consultation twice—in September 1998 and July 1999. We shall amend the regulations to take account of the concerns expressed by consultees and by Members of another place about the disapplication of partnership law to llps. That is part of considering how far we treat llps as partnerships and how far we treat them as companies. As a result, we shall include a default provision that will apply if there is no llp agreement or if the agreement does not cover a particular issue. The draft proposals were consulted on and generally welcomed by those who responded.

    It might be suggested that a significant weight of legislation will be applied to such an entity and it would be understandable if hon. Members asked whether a lighter touch were preferable. The hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) knows full well that I am very much in favour of a lighter touch. However, I would argue strongly that we shall provide for an entity that will have the privilege of limited liability and we must ensure that a balance is struck between the interests of business and an llp's potential clients. Becoming an llp will be a purely voluntary and commercial decision. Any firm that chooses to become an llp and wants limited liability will compare the llp with a company. Anyone who makes that comparison will find that the regulatory requirements applied to an llp are not unreasonable.

    The Bill has benefited from the careful and measured attention of learned consultees, learned Members of another place and the Trade and Industry Committee. As a result, we have achieved the right balance in creating a new entity that combines limited liability with the organisational flexibility of a partnership while ensuring that appropriate safeguards are applied to protect those who deal with the entity. I am pleased to commend the measure to the House.

    5.19 pm

    I declare an interest. Actually, it is not really an interest; it is more a confession: I am a chartered accountant. Some of my best friends are chartered accountants. Many of my friends work for chartered accountancy partnerships. I worked for such a partnership for 13 years before entering the House.

    The Bill is welcome. It started life under the last Conservative Government in response to concerns, particularly from the accountancy and legal professions, about the difficulties of unlimited liability. The prospect of losing one's house and savings because of the negligence of a fellow partner whom one may not even have met in a larger partnership was becoming a huge impediment to recruiting and retaining key personnel.

    I am sure that the hon. Gentleman will go on to paint the tear-jerking spectacle of those in accountancy partnerships living in terror in case their yachts, farms, pubs and holiday retreats are suddenly confiscated, but has it ever happened? We estimate that the total revenue set aside from the fee income for contingency claims was no higher than 2.7 per cent. Most of the things that are claimed to be a threat over accountancy never materialised.

    It has happened in the United States. A number of medium-sized firms have got into severe difficulties and partners have lost their personal assets, but it is the fear of losing, through no fault of their own, assets for which people have worked all their lives that is wrong. It also has an unhealthy effect on the working method within the firms. People might argue, as the hon. Gentleman no doubt would, that the prospect of losing everything if one does poor-quality work for a client concentrates the mind wonderfully and so increases the quality of work. My experience is that the determination to keep clients is the driving force behind doing good work. The fear of negligence action acts as a dampener on the work.

    Letters giving advice are packed full of caveats and disclaimers. Sometimes it is barely possible to discern the actual advice that the letter seeks to give. Huge resources are pumped into ensuring that terms of engagement are correctly documented and filed, not to improve the quality of the work, but to safeguard the firm in case of legal action. That is the consequence of the ever-present threat of legal action.

    Even under the Bill, it will still be possible for partnerships to be sued, but the prospect of partners unconnected with the negligence losing everything will go. It is wrong that, in circumstances where—the Minister alluded to it—99 per cent. of the blame for something going wrong attaches to, say, the impecunious fraudulent director of a company, and the audit firm or solicitor can be shown to be just 1 per cent. to blame for what went wrong, they can be sued for 100 per cent. of the loss. Because many of the partnerships have deep pockets, it is to those firms that aggrieved investors turn for recompense.

    The general legal concept of joint and several liability will not be changed by the Bill, but the concept and joint and several liability within a partnership will. The limited liability partnership will be suable for breach of contract to the full extent of its assets. The partner responsible for any negligence will, as the Minister said, be liable under tort, but the remaining partners will be able to sleep easy at night knowing that their personal assets will be safe.

    The Bill has been through an enormous number of stages. The last Conservative Government issued a consultative document in February 1997. A draft Bill issued by the present Government in September 1998 was scrutinised by the Select Committee on Trade and Industry. The Government issued a new draft in July last year and a final Bill came out in November. Despite all that pre-legislative scrutiny, during which many of the less attractive options were dropped, the Bill that went to the other place still had a number of problems.

    Conservative Members were concerned that the Bill provided no default mechanism to the existing body of partnership law in circumstances where the partnership agreement is silent: for example, the right to share in capital and profits, the right of a member to take part in the business, procedures for retiring as a member and procedures for holding and calling meetings. We believe that there should be a default mechanism, so that those rules are covered.

    We were concerned about the inherent ambiguities that could enable partners or members to be regarded by the Inland Revenue as employees of the llp. We were concerned about the absence of any definition of "designated member". There are plenty of subsections about the appointment of designated members and the requirement for two such members, but no mention of what they are meant to do.

    We were concerned about the inadequacy of the taxation provisions. The Bill is meant to be tax neutral, as the Minister said, but, before it went to the other place, there was no clarity over whether transferring a partnership to an llp would trigger a tax charge on the cessation of the old partnership. There is no mention of stamp duty consequences. We had enormous concerns about the insolvency provisions, which appeared to apply much stricter tests on trading while insolvent than similar provisions applicable to companies. We were concerned about the acquisition accounting requirements that llp would automatically be required to adopt. As hon. Members will clearly understand, that method of accounting for the merger of two llps would be absurd given that they do not issue shares.

    All those issues were raised in the other place by my noble Friend Baroness Buscombe. Thanks to her effort—and, one must acknowledge, to the reasonable approach of the Minister, Lord McIntosh—those concerns were largely taken on board and substantive amendments were made in Committee. We have always said that, as an Opposition, we will say it as it is. If the Government do the right thing, we will say so; if they do the wrong thing, we will oppose them. This is a good Bill—much better, it must be said, thanks to my noble Friend's scrutiny—but one or two loose ends and remaining criticisms need to be aired, to which we can return in detail in Committee.

    Far too many key provisions are hidden in secondary legislation. From the now 19 clauses and one schedule, one would have no idea of some of the Bill's basic tenets. One would have no idea that a member of an llp will remain liable to the full extension of his personal assets, notwithstanding the limited liability, for negligent work that he or staff reporting to him had carried out; no idea about a host of important issues relating to the legal position of members if the llp trades while insolvent; no idea about which company law and which partnership rules will apply to the llp. Those matters are in a host of regulations to be issued under sections 14, 15 and 16.

    The Trade and Industry Committee was highly critical of the degree of use of secondary legislation in the Bill. Its report states:
    There does not at first sight seem to be any over-riding reason why the Regulations and schedules should not be incorporated into the Bill…We would…far prefer that the detailed secondary legislation proposed be incorporated in the Bill.
    The Committee recommended that revised drafts should be resubmitted to it for re-examination. Has that happened? Was the Committee asked to have a look at the revised draft statutory instruments?

    Lord Goodhart, a Liberal Democrat peer, said in the other place:
    The Delegated Powers and Deregulation Committee in your Lordships' House, of which I am a member, accepted the Government's proposals to put these provisions in regulations. But it seems to me that this comes close to the borderline and the more I look at sonic aspects of this Bill the more doubtful I am whether the Delegated Powers Committee was not rather too lenient.—[Official Report, House of Lords, 9 December 1999; Vol. 607, c. 1438.]
    He was right to express concern. The Committee's report draws attention to the fact that what is now clause 16 is
    a Henry VIII provision which allows regulations to amend or repeal primary…legislation.

    The hon. Gentleman's criticisms are well placed: he is a well-known deregulator. However, is he aware that the first set of regulations will be subject to the affirmative procedure and that affirmative resolutions will then apply to anything that we introduce immediately afterwards? That should be some defence.

    I am aware of that, but I am grateful to the Minister for bringing it to the attention of the House. However, affirmative secondary legislation is still a far cry from primary legislation. Many regulations in that pile of draft regulations amend primary legislation. I have great concern, shared by many Members of both Houses, about secondary legislation amending primary legislation.

    That was not the Committee's main concern. Its main concern was that the draft regulations created offences punishable on summary conviction by a fine, but the way in which those instruments were drafted was wide enough to allow the regulations to provide for imprisonment or for trial on indictment. The Committee thought that the Government intended to use those powers only to provide for summary trial and fine, and wanted that limitation to appear on the face of the Bill. As Lord McIntosh admitted in the other place,
    it is our intention to apply to LLPs the same offences as apply to companies…In some cases these offences are triable on indictment and punishable with imprisonment.—[Official Report, House of Lords, 9 December 1999; Vol. 607, c. 1421.]
    The Government wanted to see those powers to create offences which carry a punishment of imprisonment. Given that admission, and the fact that the Delegated Powers and Deregulation Committee had assumed in its conclusions that the delegated powers would not be used for such purposes, I urge the Committee's Chairman to look at the Bill again. I shall be interested to hear the Minister's response on that concern.

    The over-use of delegated legislation is a serious matter, which should be of concern to all hon. Members. We shall seek to put it right, regardless of administrative inconvenience or precedent.

    Our remaining concern over the drafting of the Bill relates to what have become known as the default provisions. The Minister also referred to them as such. Under clause 1, the whole body of partnership law is disapplied as regards llps except where it is explicitly provided for in the Bill. This is of concern because most of the firms that will want to convert to llp status will simply use their partnership agreement as the basis for the internal arrangements within the llp. The agreement may well be silent on a number of important issues, because well-established partnership law provides these details where they are not explicitly set out in the agreement. Small partnerships in particular will have relatively short agreements which may not include details such as the rules for the retirement of partners, the detailed rules about calling meetings or rules giving all parties the right to see the books and records. Those rights and rules are all there in general partnership law. To disapply that law may well cause difficulties for such smaller firms.

    Presumably the hon. Gentleman is not arguing for over-prescription in terms of what a partnership should or should not be. One of the strengths of partnerships is the flexibility of arrangements. We are not seeking to take that away.

    I am grateful to the Minister for that intervention, but he misses the point. Our proposal in the other place was for a simple default provision where there were no provisions in an agreement about certain aspects of the partnership arrangement. When a crisis arose, those involved in a partnership could always fall back on those partnership laws that had evolved since 1890 through the courts and in statute. The Bill explicitly removes that default provision and could therefore give rise to difficulties. That is why in the other place my noble Friend Lady Buscombe proposed a provision that, for the avoidance of doubt, partnership law would apply if not otherwise excluded by the Bill. The Government rejected it on the grounds that, as the llp had a separate legal identity and would need primarily to adhere to the Companies Act rules, having a default to the partnership law rules might result in confusion and possible conflict.

    I agree with the central thrust of what the hon. Gentleman is saying. Does he agree that one of the great advantages of the Partnership Act 1890 is that not only has it stood the test of time, but a great deal of case law behind it is intelligible and easy to understand?

    The hon. Gentleman makes a very good point. We can never anticipate all the problems that will arise, but a hundred years of case law will probably have covered almost every likely contingency. We are rejecting that hundred years' experience in having clause 1(5) disapply all that body of partnership law.

    We do not accept the Government's argument about why there should not be a default provision, because we are talking about the rules relating to the partnership agreement and the relationship between partners. The Law Society is also clear on that point. In its briefing for this debate, it states:
    The Law Society has always considered there to be the need for some default provisions that would operate in the absence of agreement to the contrary within a limited liability partnership and which would cover certain basic matters relating to the mutual rights and duties of the members of an LLP.
    In response to such concerns, the Government issued a consultation document in February, which proposed incorporating specific partnership law rules into delegated legislation under clause 15(c) of the Bill. The Government amended the Bill in the other place to enable that to happen. We will no doubt debate the issue in detail in Committee, but key provisions such as fundamental partnership rules should appear in primary legislation. We stick to our view that the Bill should contain an overall default provision.

    I would also be grateful if the Minister could address another important concern raised by the Law Society over whether the Administration of Justice Act 1960, as in force, will permit firms of solicitors to adopt the new form of incorporation. It understands that the Act will need to be amended, so I hope that the Minister will respond to that point.

    This is now a much improved and useful Bill that will assist professional firms to recruit and retain top-quality staff and partners who otherwise might be put off by the prospect of perpetual unlimited liability arising from the negligence of others. It should also reduce the risk of such partners fleeing to non-UK jurisdictions. Subject to our remaining concerns, which we will address in Committee and about which I trust the Minister will be as reasonable as his colleague in the other place, we remain supportive of an important and useful Bill.

    5.37 pm

    I tend to get suspicious when I hear bipartisan bleating about how wonderful a Bill is, although that is not why I wished to speak. I do not know whether we will have a tripartisan bleat from the Liberals, although they put in some good work in opposition to the Bill in the House of Lords. I hope that that might be followed up here.

    The Bill is not the epoch-making measure that it has been portrayed as, by both my hon. Friend the Minister and the Opposition. It is a shabby measure. If not sordid, it is at least suspect, and it is interesting that the songs of praise for it have come largely—in fact, overwhelmingly—from the vested interests. It is regarded as a technical Bill, but it will have enormous repercussions that should be more widely discussed. Unfortunately, we cannot discuss them in an atmosphere in which everyone agrees that the Bill is wonderful.

    The Bill will take the limited liability partnership—a device that began as a vehicle for tax evasion in Texas and Delaware, specifically to limit the tax obligations of partners in firms—and turn it into a new vehicle for corporate business. We do not know what the consequences of doing that will be. They could be substantial or they could be minimal. I fear that they will be more substantial than we think.

    The change in company and partnership law is being done at the behest of the mighty and the greedy, and indeed the mighty greedy. The lobby for the Bill comes overwhelmingly from the big five—formerly big six, until they started eating each other—accountancy houses. The fee revenue of the big five was £4.5 billion in this country alone in 1999. That makes them powerful organisations, and I do not like the spectacle of the Government rushing to serve their purposes, their greed and their desire to protect their profits, revenues and incomes as partners. I can understand the Conservatives doing that, because that was the whole process of Conservative Government for 18 years, and it is fitting that they began the Bill. I am more doubtful when a Labour Government pursue the measure. After all, Labour is a new and pristine party that will not make concessions to vested interests. We must ask why the Bill is being introduced—and especially why now?

    We know that the legislative timetable is packed. We know that there is a long queue of Bills. Discussions at the meeting of the parliamentary Labour party last week produced an enormous list of proposals from Labour Members for the legislative programme next year. These proposals included measures to deal with hunting with dogs; housing, including multiple occupancy; pensioners and carers, especially action on long-term care; the regulation of the private security industry; regulation and reform of park homes; equality and employment legislation; and consumer protection measures.

    Those proposals are only a part of the list. There is an enormous list of socially responsible and sensible legislation that needs to be introduced, but we are told that that cannot happen because of pressures on the legislative timetable. However, one of those pressures is this sordid little Bill. Why is it being introduced, and why now?

    It is a concession to a major vested interest, that of the big five accountancy houses. Unfortunately, it is not matched by any balancing changes to afford protection against any of the powers that are being given through the Bill. The Bill includes no protection for consumers of accounts—they are pretty weak or impotent when it comes to dealing with the big five or with unreasonable audits. Stakeholders in companies have very few rights to protect them from negligent auditors, but we are rushing to strengthen the position of those auditors. It is unreasonable to proceed in that way.

    If we are to make such a concession to the big accountancy houses—we are giving them a special privilege—let us also give some privileges to the consumers of accounts, to stakeholders and to those who suffer from negligent auditors. We should reverse the Caparo judgment; we should impose a duty of care on auditors; and we should stop auditors taking on other business and thus introducing dilution. Company law imposes liability. Directors are responsible and liable if they publish false and misleading accounts. However, if an auditor publishes such accounts, there is no responsibility. Nevertheless the Bill will give auditors increased privileges.

    The provisions that I have suggested could have been dealt with at the same time as the Bill. There is no reason for haste. That is why I have asked why the Bill is being dealt with so quickly. The Department of Trade and Industry company law review is continuing. It may propose some of the changes that I would like to see to redress the balance towards the consumer. Why not make these changes at the same time? That should be part of the deal.

    If the big accountancy houses want to secure a special concession, in return they should make concessions to protect the consumer. However, they are not doing so, and we are handing them a concession on a plate. That is extremely unreasonable, especially for small shareholders, along with the stakeholders and employees who want to know what is going on in their company and want honest, objective and effective audits. It is unreasonable similarly for those who rely on accounts to make investments. We are not giving those people any concessions while the vested interest is getting all that it wants. It seems that the consumers of accounts were not consulted in that process.

    What about Lord Paul and his experiences with the purchase of a Fidelity radio? He found that if he was to sue the auditors he had to buy the company and sue the directors, who then had to sue the auditors. That sort of experience gives me no faith in redress against auditors, yet auditing is a monopoly granted by the state to a particular class of people. Why are we giving them a concession when it is surely our job to regulate them?

    The United Kingdom has public limited companies and 600,000 partnerships. Now, we are creating an intermediate breed, limited liability partnerships, which might even be called a corporate third way—although I do not think that such a development was envisaged in Professor Giddens's third way. This development could have severe consequences. Such partnerships could be established by fraudsters and by those who have been disqualified as company directors. We are diluting controls over those people, who could slough off their responsibilities.

    I know that new Labour is nice to business, and that it is right that we should be nice to business. All sections of the community have to get on. We are not in a class war and we no longer feel basic antagonism towards business. I also know that the accountancy houses have been very nice to Labour. When we were in opposition, they gave employment to people who have subsequently become Ministers. They have organised conferences for us, provided advisers and advice, and even attended our fund-raising dinners. They have done us good service. I do not think that they did that with any view of a return such as the Bill—they are averse to such sordid motives—but they are not averse to getting this legislation.

    The legislation's origins are very murky indeed. I should like to detail those origins because they are not based solely on a process of consideration, as we have been led to believe by the hon. Member for Bognor Regis and Littlehampton (Mr. Gibb) and Ministers. The fact is that the big accountancy houses got into a panic—which was well detailed by the hon. Gentleman—because, as they have deep pockets, they felt vulnerable. They were afraid that people would make huge claims against auditors. They were afraid that people were thinking, "If you cannot do anything else, you can make a claim against the auditors." However, the panic that possessed auditors bore no relation to reality. It also took no account of their own involvement in their own mistakes.

    These days, the accountancy houses offer auditing services to the big public limited companies and essentially use those services as a market stall from which to sell other accountancy services. They get their foot in at the plcs by auditing them, and then use the audit service as the basis for selling other services to the company. That practice, however, dilutes the auditing process. Obviously, if they want to sell other services to the firm, they will be complacent in auditing. Audit problems in such situations are, therefore, of the auditors' own making.

    There may be audit problems and dodgy companies, but who made the auditors take on those companies as clients? Who made them take on Maxwell? What force was used to make auditors audit the Maxwell accounts or the Bank of Credit and Commerce International accounts? Auditors do not need to take on the accounts of dodgy companies. They should, therefore, face the consequences of dealing with such companies. The accountancy houses are in that position because of their own greed and their desire to maximise both fee income and the sale of other services to audit clients.

    The hon. Member for Bognor Regis and Littlehampton tried to hype up the houses' panic and alarm, but all the examples that he gave were from America. He could not produce any evidence of huge claims. The Select Committee on Trade and Industry also commented on the lack of evidence. Even the figures that have been mentioned are suspect, because they are the claim figures, not the settlement figures—which have not only been kept very quiet, but are very small indeed.

    The hon. Gentleman also took no account of the fact that those who sue auditors usually come from other parts of the same big five accountancy house. Usually, the insolvency arm of an accountancy house sues to reclaim money from the audit arm at the same or another big five accountancy house. It is the worst type of incestuous suing. The tenor that auditors have expressed is terror of themselves and of other parts of their own firm.

    Does not the small number of settlements and claims to which the hon. Gentleman referred rather contradict his lifetime's work in condemning audit firms' ability to do their job well?

    I do not condemn the ability of audit firms to do their job well, but they are influenced by a desire to sell other services, which might make them more complacent than they would otherwise be. Business needs good, honourable auditors of integrity who provide a true and fair account of the affairs of the company. I do not want any constraint on that. If auditors do not do that, they should suffer the consequences. The Bill does not provide for that. We are protecting them from suffering the consequences by allowing them to escape the liability. We are not giving them any discipline or sanction to force them to provide that service.

    I made it clear in my speech that limited liability partnerships are subject to all the same restrictions and controls as companies on fraudulent dealing or any other form of misdemeanour. I do not understand why my hon. Friend thinks that they are suddenly above the law.

    I do not think that they are above the law, but no protection has been offered to the consumer. Admittedly, partnerships as they exist do not provide such protection, but we need a sanction against bad audits, fraudulent audits or misguided audits, which at present we do not have. The Bill will limit the liability of partners who might have been responsible for such audits. My figures suggest that only 2.7 per cent. of the total fee income of the big five goes on liability-related expenditure. Their huge tenor about the grab at their deep pockets is over 2.7 per cent. of their fee income. It is difficult to get verifiable information about that.

    The accountancy firms tried to panic the Conservative Government, who referred the issue to the Law Commission. On the ground that proportionate liability did not fit in, the Law Commission said no go—it might have said it in Latin, but it said that the firms could not have that special concession.

    The big audit firms then began another devious manoeuvre. They were so anxious to secure limited liability that they went to the Jersey legislature and tried to buy legislation on their own terms. It was drawn up by Slaughter and May and financed by what was then Price Waterhouse and by Ernst and Young at a cost of £1 million. The Jersey law draftsmen found the legislation very unsatisfactory, but it gave the big audit firms all that they wanted. One of the senior partners of Price Waterhouse said that they were promised that it would be nodded through.

    Unfortunately, the legislation that the firms wanted was not drawn up properly and the Jersey legislative draftsmen raised doubts. Attempts to rush it through caused protests and the expulsion of Senator Syvaret. It was delayed and the firms did not get the fast-track procedure that they wanted. When they got the legislation, they were warned by the Inland Revenue that there would be tax consequences if they set themselves up as limited liability partnerships in Jersey—so, after all that effort buying legislation in Jersey, no firm went there. They were using the process as a means of pressuring the Conservative Government. The hon. Member for Bognor Regis and Littlehampton has told us how proud he is of his accountant friends. Some of my best friends are accountants. A fear was created in the Conservative Government that all those black-coated accountants would don their black suits and trot off to Jersey to work in the sun.

    That threat produced action. The Conservative Government began to draw up the legislation, we have continued with that. They did so under pressure from the big five and with a departmental civil service that works in what I would call close collusion—but let us say cahoots or a relationship—with the big accountancy houses. They are anxious not to offend them and are keen to do what they want, as they did in this case.

    I pay tribute to my hon. Friend the Minister for his willingness to listen to the criticisms. The same goes for his predecessor. Changes were made—for example, we warned that if the concession was given just to accountants, other professional groups would have a rights case against the Government that they should be able to set up limited liability partnerships, so the original intention had to be widened.

    However, the pressure was too strong and the Bill is the result. I still do not understand why it is necessary. I sat on the Committee that considered the Companies Bill in 1989—it was my last great effort as a Front-Bench Labour spokesperson. I was fired just before the Committee began its proceedings, but I still took a close interest in it. That legislation gave the accountancy houses the right to set themselves up as plcs if they wanted. They had been pressing for that, claiming that the fate of the accountancy profession depended on being given plc status. We gave them it, but only one accountancy firm took it up, converting its audit arm into a plc. That shows how they panicked. That alternative is still available. Why do they not want to be plcs? Why do they want special limited liability partnership status?

    In 1991, the Institute of Chartered Accountants in England and Wales said that
    the obligation…to publish their accounts is perceived as a considerable drawback.
    In other words, the firms want to keep their business to themselves. They do not want the partners to have to reveal their income. They do not want to reveal anything beyond the firm's total fee income. That is why they did not want to take up the offer of plc status.

    We are giving those firms what they wanted. I am not sure of the tax position. As partnerships, they have advantages over plcs. The Bill does not create a new tax regime for llps. The Bill says that the tax effects are neutral. I am not sure. I hope that my hon. Friend will deal with that. Large numbers of plcs might see the benefits and convert themselves into llps. What is to stop them? There could be a mass exodus, not from partnerships to limited liability partnerships, but from plcs to llps. Do the Government anticipate that? Has there been an estimate of the possible scale of that? What are the restrictions?

    Such a move would minimise corporation tax obligations. Indeed, the firms would escape the corporation tax regime and move on to schedule case 1 and 2. That requires them to be taxed on a cash basis, not an accrual basis. They can stagger their payments over a far longer period than plcs can. That is the advantage. Any account can be shifted from one year to another.

    Expenditure on entertainment—or whatever—for plcs has to be wholly, exclusively and necessarily required. That is three obligations. For partnerships, the word "necessarily" is dropped. That is a much laxer tax regime on entertainment spending. Companies pay corporation tax nine months after the end of the year; llp partners have up to 21 months to pay their tax. That gives much more scope and must offer tax savings. As legal entities, plcs have a liability to pay tax and llps do not. The partners, not the organisation, are liable. The organisation c