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Lords Chamber

Volume 387: debated on Thursday 17 November 1977

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House Of Lords

Thursday, 17th November, 1977.

The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.

Prayers—Read by the Lord Bishop of Worcester.

The Lord Adrian—Sat first in Parliament after the death of his father.

Airline Overbooking Compensation

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government what progress has been made concerning the application of the overbooking compensation scheme to return flights resulting from an original booking made in the United Kingdom on British airlines so that a passenger may be covered for the whole of his ticket and not, as at present, for half of it; and whether they will make a Statement on the progress made on this matter in the European Civil Aviation Conference.

My Lords, earlier this year, we invited the European Civil Aviation Conference to consider the scope for arrangements for overbooking compensation between airlines of Member States. At a meeting of that body in June it was decided that a questionnaire should be drawn up to gather facts on the overbooking practice and comments on approaches to it to provide a factual basis for discussion within ECAC. The questionnaire, which I mentioned in my reply of 16th June, has been circulated to the 20 Member States of ECAC and to date replies covering 13 Member States have been received. A Paper is now being prepared summarising the responses and this is to be considered at a meeting of an ECAC Working Group to be held on 6th to 8th December. A decision on further action is expected to be taken at that meeting.

My Lords, is my noble friend aware that when he began his reply I was getting very angry because he was repeating word for word what he had told me on 16th June? However, is he further aware that as he progressed my anger became assuaged, if that is the right term? Is he also aware that I am very grateful to him and to the Government for what they have done in this matter?—because I gather from what he said that practically all the members have replied and a further meeting is to be held on, I think he said, 6th to 8th December. Could my noble friend comment on the possibility, prior to the House rising for the Christmas Recess—unless it rises very early—of having a Question put down and an Answer given on what stage has been reached?

My Lords, I confirm what my noble friend said about the facts that I included in the original Answer. I agree that there should be an opportunity for the House to consider the outcome of the Paper probably before the Christmas Recess.

My Lords, I really am very much obliged to my noble friend.

Shipbuilders' Nationalisation Compensation

3.9 p.m.

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government when they expect to start honouring their undertaking to make "a substantial and early" payment on account in compensation to nationalised ship-building firms.

My Lords, the Government intend to authorise a payment on account for all companies during January in the light of a preliminary view of their likely negotiating position.

My Lords, is the noble Lord aware that it is good to hear that the Government are contemplating paying something? Will he keep in mind that procrastination in agreeing these payments on account can only delay the reconstruction of the businesses concerned, which carries with it vital hopes of helping to ease the unemployment problem? Will the noble Lord also keep in mind that to use this application of payment on account as a weapon to secure an unfair final settlement on the total account would be contrary to the Statement made by the noble Lord himself and by his right honourable friend in another place? To do that—and it has been suggested in some quarters that it is at present happening—would be verging on sharp practice.

My Lords, it was the Government's recognition of the need for an interim payment that brought about the inclusion of such a provision on account of the Aircraft and Shipbuilding Industry Act. I think the noble Lord is imputing future misbehaviour to the Government which is not the case. I think he is condemning us in advance for something that we are not likely to do.

My Lords, is the noble Lord aware that 18 engineering companies are concerned and that they do not know where they stand at the moment? Can he assure the House that conditions will not be laid down about the degree of the final settlement before this payment—this substantial and early payment—is made?

My Lords, I cannot give an exact assurance on that point, but I can say that if there are unforeseen delays a second interim payment may be made.

My Lords, can my noble friend state how much the payment on account involves and where the money is coming from?

My Lords, it depends entirely on what my noble friend means. The payment on account, of course, comes from the issue of Government stock. Noble Lords will have noted that I have answered the point relating to an early payment but not to "substantial payment". There are two aspects involved here, and I should like to make an important point on this which may clarify the situation for my noble friend. Noble Lords will appreciate that, especially where the vesting companies formed a large part of the group, indications of percentages could influence Stock Exchange prices for the parent companies concerned. That implication has been recognised by a number of the stockholders' representatives. I would say, simply, that the size of the payment will be related to the provisional valuation placed on each company.

Apart from that, my Lords, is the noble Lord aware that the answer he gave to my noble friend was in direct conflict with the rather optimistic answer that he gave to me? Can he give a clear statement that there is no question of the final payment of the total being tied to their asking for a payment on account? To suggest that they have to accept a payment on account, and in doing that commit themselves to a final payment which they have not felt fair or, as yet, agreed, would be very wrong and would verge on sharp practice. The answer to my noble friend is not quite so clear as the rather optimistic one which the noble Lord gave to me.

My Lords, can the noble Lord say how far the views which he has now expressed are satisfactory to the shipbuilders? Coming, as I do, from an area where shipbuilding has been one of our major industries, I consider it very important that they should have fair and just treatment and I am not satisfied at the moment, in view of the noble Lord's answer, that they will get it.

My Lords, there is machinery for arbitration if they consider that they are not receiving fair and just treatment.

My Lords, is the noble Lord aware that it is now over eight months since the Royal Assent to this Bill, and that no large sums of money are involved? There is one company which does not know whether it is going to get £5 million or £25 million in compensation. Do the noble Lord and the Government not realise that this uncertainty is leading to a situation in which reinvestment and restructuring cannot take place, and consequently new employment is not forthcoming?

My Lords, Her Majesty's Government are well aware of that; hence the interim payments. Of course, it is not eight months. I seem to remember that the undertaking which I gave to the noble Lord, Lord Orr-Ewing, was six months from 1st July. In point of fact, the interim payment is only three to four weeks longer than that forecast which I gave at the end of July.

My Lords, is my noble friend aware that it is not fair to himself, if I may say so with respect, that a Department to which he applies in order to be furnished with an appropriate reply to the Question on the Order Paper is not able to tell the House how much is involved?

My Lords, this is an extraordinarily complex subject. It is absurd, I grant you, but bloody difficult, as the parrot said. May I make this point: The Government's accountant advisers, Whinney Murray and Company, are preparing assessments and valuations of the unquoted acquired companies. These will be completed progressively during December to February and will enable the Government's opening position to be formulated, after which negotiations can proceed. Whinney Murray have also been working on inter-company debt to be deemed security. This will be reported to Ministers shortly and it is hoped that all parent companies, except Vickers Limited in respect of shipbuilding, will be informed during November of their position under Section 21.

My Lords, I wonder whether the noble Lord will allow me to say that I agree from the answers I have heard that it is a very complex subject? Beyond that, will he perhaps inform his colleagues, and help to strengthen their view, that there are in many areas of Scotland—there is one fairly close to me—a large number of firms that have been nationalised? Irrespective of our views about nationalisation, we all hope that they may be successful in increasing employment, but, so long as this complex situation continues, there is a vast potential for new employment—and, my goodness! we need it—which is being held up. Cannot a substantial payment be made quickly and without too much fuss?

My Lords, I cannot go too far into the future. The Government agree completely with what the noble Lord has said. It is a value judgment, and by mid-January we hope that payments will have been made, and we can then discuss whether or not they are substantial.

My Lords, as the good faith of the Government is involved in this matter, can the noble Lord perhaps use his influence with his noble friend the Leader of the House to have this matter debated rather quickly? It is worth it, because of its complexity and because of the importance behind it.

My Lords, Members are quite entitled to conduct a cross-examination, but I think that we have had enough of this subject.

My Lords, noble Lords can come back in their own way, if they wish. I am just thinking that we have now been on this Question for 10 minutes, and we do not want speeches.

The Ordnance Survey

3.18 p.m.

My Lords, I beg leave to ask the first Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government when they intend to announce the establishment of the study on the Ordnance Survey and whether they have yet issued invitations to representative bodies and individuals to serve on the inquiry.

My Lords, my right honourable friend hopes to make an announcement very soon. No formal invitations have yet been issued, but various informal approaches have already been made.

My Lords, will my noble friend recall that the Secretary of State wrote to the Royal Society in the summer, saying that he intended to announce this survey early in October? Is my noble friend aware that anxiety and concern continue? Can she give an indication as to the kind of invitations or soundings that the Government are making?—for if this inquiry and its results are to carry confidence it must include people from outside and not merely departmental members.

My Lords, I hope the noble Lord will accept my assurance that it will include a number of people from outside organisations. It is not a completely internal study. The Ordnance Survey's consultative committees, which represent users, have been asked to make suggestions to my right honourable friend for committee members. Obviously, every category of user cannot be included on a study of this kind; otherwise, it will become impossibly unwieldy to manage. But I should be very surprised if, when they are announced, some of the committee members do not appear to have considerable knowledge of users' interests. I accept that my right honourable friend had earlier hoped to have the study group set up by October, and we are sorry that it has taken so long. We had hoped to have completed the arrangements by now. But I know my noble friend will agree with me that preparations for a major review like this must not be rushed.

My Lords, even if my noble friend would be surprised if it was not a satisfactory committee, in view of the past history of two Governments in dealing with the Ordnance Survey, I for one would not be surprised. May I therefore ask my noble friend to realise that there is strong support for the view that I am sure she holds, that there should be a body with real representation from outside? May I also ask her whether it is the intention that the report will be published, and, hopefully, the evidence?

My Lords, I still hope that my noble friend will not be quite so sceptical and will accept my assurance that we hope that a considerable number, if not the majority of the people serving on this committee, will be from outside organisations, including user interests. I could not pre-empt my right honourable friend's announcement about the appointment of the committee or about what will happen to the report, but at this stage I cannot see any reason why the committee's conclusion should not be published.

My Lords, could the noble Baroness say whether we shall have news of this appointment before the House rises for Christmas? The matter has dragged on for a long time and one begins to suspect that communications have been taking place by post.

My Lords, I know that, in Parliamentary terms, "shortly" covers a multitude of sins. I said that my right honourable friend hopes to make the announcement shortly, and I hope that that "shortly" is the literal interpretation of it and that we shall have the announcement before Christmas.

My Lords, is my noble friend aware that one of the user interests, so far as the Ordnance Survey is concerned, is price; that the price of these maps has gone up considerably more than the general inflation level, and that a kind of Penguin edition, made available to ordinary people living in the country, would command a very big market?

My Lords, that question goes rather wider than the original Question which was asked by my noble friend. We had a long debate on the pricing policies of the Ordnance Survey. Changes have been made in the copyright practices and the fees and that was a once-for-all change to rationalise the position. There are no plans for anything further on that scale, but map prices must reflect the inflationary increases in the cost of production and, so far as we can tell, the effects of rationalisation do not appear to have been quite so burdensome on schools and the map publishers as we were led to believe in our recent debate.

My Lords, will the noble Baroness agree that it is nearly two years since the subject was first raised in this House? Could the noble Baroness also give an indication of the increase in price and of the increase in the sales of Ordnance Survey maps?

No, my Lords, not without notice of the question; but I will make some inquiries and will write to the noble Lord.

My Lords, could the noble Baroness give an assurance that one of the members of the committee will come from Scotland or some other Celtic region?

My Lords, without betraying any secrets, I think I can say that efforts are being made to find somebody from Scotland and somebody from Wales to represent users' interests.

My Lords, will the noble Baroness take steps to ensure that somebody from the Ramblers' Association is represented on the committee, in order to make certain that no longer is there any confusion between parish boundaries and footpaths, as now occurs on the latest edition of Ordnance Survey maps, a fact which makes the passage of a rambler, who is following what he thinks is a footpath but which turns out to be a parish boundary, sometimes rather perilous?

My Lords, the Ramblers' Association represent a very valuable part of my right honourable friend's consultative committee. I do not know the names which have been put forward by the consultative committee. However, they have been asked for names and I understand that they have submitted a selection from which my right honourable friend can choose.

My Lords, my noble friend has again worried me by saying that the report will probably be published. However, the whole object of the exercise is to produce a report and publish it. Cannot my noble friend guarantee that it will be published, and cannot she also take note of the fact, since there was a reference to copyright, that the Whitford Committee, contrary to what the Ordnance Survey said in their report, recommended the abolishment of royalty charges in this area? Can my noble friend also confirm that the national grid now joins latitude and longitude in not being regarded as copyright?

My Lords, that is a question which strays rather widely from the original one. So far as publication is concerned, as I have said to the House, I cannot pre-empt my right honourable friend's announcement. However, when he makes his announcement of the names of the people who will serve on the study group, I confidently expect that at the same time he will be able to assuage the fears of my noble friend by saying that the report will be published.

Ordnance Survey: Archaeological Branch

3.26 p.m.

My Lords, I beg leave to ask the second Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether it is now their intention to disband the archaeological survey section of the Ordnance Survey.

My Lords, the archaeological branch of the Ordnance Survey is being reorganised. In future, the Ordnance Survey will obtain archaeological information from local professional archaeologists or archaeological organisations instead of extracting it themselves from published material. Secondly, those topographic surveyors who have been concerned solely with surveying and mapping visible antiquities are being redeployed under the discretion of Ordnance Survey regional controllers and will not be restricted to archaeological work.

My Lords, may I ask my noble friend why this decision was taken preparatory to setting up a committee of inquiry into the work of the Ordnance Survey? Is my noble friend aware that this is comparable to the decisions taken earlier on tertiary benchmarks and the 1:25,000 map, upon which the Ordnance Survey and the Government had to resile? Is my noble friend not aware that this has caused great concern, because although there has been some consultation the disappearance of the professional archaeological officer suggests that once again economies are being made without taking due account of the views of professional archaeologists?

No, my Lords, I do not accept what my noble friend has said. We have been looking at the question of the archaeological work of the Ordnance Survey. The Ordnance Survey will continue to survey and map the visible antiquities, and they will maintain the national non-intensive record of those visible antiquities. They will publish and sell period maps. The maintenance of the national record of the invisible antiquities after March 1978, when the current Department of Environment contract expires, is being discussed with the Royal Commission on Historical Monuments. While all branches of Government service are having to take a share of the expenditure cuts, we cannot at this time except the archaeological service.

My Lords, the noble Baroness referred to professional archaeologists outside the Ordnance Survey as though she intended to mean that there are no professional archaeologists inside the Ordnance Survey. Is the noble Baroness not aware that there used to be two or three professional archaeologists in the Ordnance Survey whose work was the admiration of archaeologists in other Government Departments?

No, my Lords, I was not suggesting that the only professional archaeologists were those outside the Ordnance Survey. Certainly we have our topographic surveyors who have done magnificent work within the Ordnance Survey. However, we have had negotiations with county councils and with other archaeological bodies and we are satisfied that some 75 per cent. of the counties who have this kind of service or liaison with archaeological bodies within their counties are willing to co-operate with the Government. We shall still have our topographic surveyors who will be allocated to the regions, who will still be doing some work on archaeology and who will be available to give us expert assistance, if that is needed, when we receive reports from outside the service.

My Lords, arising from that reply, may I ask the noble Baroness to confirm that the field service sections of the Ordnance Survey are being disbanded, and, if that is so, what steps are now being taken to fulfil the functions which have hitherto been fulfilled by those special sections?

My Lords, there has been much correspondence in The Times since the question of the reorganisation of the archaeological service broke out. Some of the letters have shown confusion over the use of the terms. Certainly professionally qualified field archaeologists were used in their field capacity until 1940, but since 1940 no professionally qualified field archaeologists have been used entirely in their field capacity. We have very good topographic surveyors and very good field archaeologists, but they are not employed entirely in their field capacity.

My Lords, is my noble friend aware that this subject has produced, as she will have seen from the correspondence in The Times and elsewhere, very considerable disquiet in archaeological circles? With great respect to the work that is being done in some counties of this country and in Scotland, that is not universally the case, and my general impression from the correspondence I have received is that this decision is regarded as a false economy and a great disservice both to archaeological research and to historical science in this country. Will the Government please be good enough to reconsider this decision in the light of the voluminous objections which have been received on the subject?

My Lords, I can certainly give the assurance that the Government will be monitoring the effects of this decision, and when the study group which my right honourable friend will be setting up very shortly has completed its work then, in the light of any recommendations they may make and the experience that we have gained and have monitored in the intermediate time, we shall be able to make such adjustments or changes as are necessary. But we had advice from an inter-departmental working group which reported way back in September 1974 that we needed this sort of reorganisation, and the professional archaeologists, including those in the Ordnance Survey, have been involved in discussions over the last two years on those aspects of reorganisation which affect archaeological sites. There was no discussion with outside bodies on this because we saw it as being purely a management matter within the Ordnance Survey.

My Lords, I should like to ask my noble friend why she said that this was now a matter of economy when it arose out of an inter-departmental Working Party that took place in 1974, about which very little is known, and on which most of the archaeologists were in fact in disagreement with this proposal? When the noble Baroness said, in reply to the noble Lord, Lord Inglewood, that she did not wish to suggest that no professional archaeologists were involved, she would have been perfectly correct in so suggesting because there are now no professional archaeologists working for the Ordnance Survey.

My Lords, when any Department is asked to make expenditure cuts they obviously look back through their files to see what sort of suggestions have been put to them in the past, and no doubt that is why the archaeologists were subject to this report that we had in September 1974. It offered one chance of making a little saving without, we are certain, damaging the service that we offer.

My Lords, will the noble Baroness give the House some idea of the order of magnitude of the economy which has been achieved by this rather disturbing reorganisation?

My Lords, I cannot give the figure of pounds saved. What I can say is that the people who have been doing the specialised archaeological work have now been allocated to the regions where they will be doing other work as well as that concerned with archaeology. There will be fairly consistent savings in subsistence and in travelling costs and travelling time and there will be some saving in the fact that we have not reappointed a chief archaeologist.

My Lords, I think noble Lords will agree that on this Question we have had a good innings.

Leave Of Absence And Lords' Expenses

My Lords, I beg to move the first Motion standing in my name on the Order Paper.

Moved, That a Select Committee be appointed for the general supervision of arrangements relating to leave of absence and the reimbursement of Lords' expenses; and that, as proposed by the Committee of Selection, the Lords following, with the Chairman of Committees, be named of the Committee:—

  • Hylton-Foster, B.
  • Llewelyn-Davies of Hastoe, B.
  • St. Aldwyn, E.
  • Wigoder, L.

—( Lord Aberdare.)

On Question, Motion agreed to.

House Of Lords Offices

My Lords, I beg to move the second Motion standing in my name on the Order Paper.

Moved, That the Select Committee on the House of Lords Offices be appointed and that as proposed by the Committee of Selection the Lords following, with the Chairman of Committees, be named of the Committee:—

  • Alanbrooke, V.
  • Banks, L.
  • Byers, L.
  • Carrington, L.
  • Champion, L.
  • Cholmondeley, M.
  • Collison, L.
  • Crawshaw, L.
  • Darling of Hillsborough, L.
  • Denham, L.
  • Drumalbyn, L.
  • Eccles, V.
  • Elwyn-Jones, L. (L. Chancellor)
  • Faithfull, B.
  • Ferrers, E.
  • Fraser of Tullybelton, L.
  • Glenkinglas, L.
  • Goronwy-Roberts, L.
  • Greenway, L.
  • Greenwood of Rossendale, L.
  • Gridley, L.
  • Henley, L.
  • Hood, V.
  • Hughes, L.
  • Hylton-Foster, B.
  • Ilchester, E.
  • Kemsley, V.
  • Kings Norton, L.
  • Kinloss, Ly.
  • Kinnaird, L.
  • Lee of Newton, L.
  • Llewelyn-Davies of Hastoe, B.
  • London, L.Bp.
  • Long, V.
  • Lovell-Davis, L.
  • Mowbray and Stourton, L.
  • Newall, L.
  • Nugent of Guildford, L.
  • O'Hagan, L.
  • Peart, L. (L. Privy Seal)
  • Ponsonby of Shulbrede, L.
  • Robertson of Oakridge, L.
  • Rochester, L.
  • Sainsbury, L.
  • St. Aldwyn, E.
  • Sempill, Ly.
  • Shackleton, L.
  • Sherfield, L.
  • Soper, L.
  • Stedman, B.
  • Strabolgi, L.
  • Strathcona and Mount Royal, L.
  • Tweedsmuir, L.
  • Westbury, L.
  • White, B.
  • Wigoder, L.
  • Winterbottom, L.

—( Lord Aberdare.)

On Question, Motion agreed to.

Examiners Of Petitions For Private Bills

My Lords, I beg to move the third Motion standing in my name on the Order Paper.

Moved, That, pursuant to Private Business Standing Order No. 69, Mr. J. H. Willcox be appointed an Examiner of Petitions for Private Bills in the place of Mr. D. Scott.—( Lord Aberdare.)

On Question, Motion agreed to.

Business Advertisements (Disclosure) Order 1977

3.35 p.m.

rose to move, That the draft Business Advertisements (Disclosure) Order 1977, laid before the House on 29th July, be approved. The noble Lord said: My Lords, Part II of the Fair Trading Act enables the Secretary of State or any other Minister or the Director General of Fair Trading to refer to the Consumer Protection Advisory Committee the question whether a consumer trade practice adversely affects the economic interests of consumers in the United Kingdom. If the Director General considers that a consumer trade practice misleads, confuses or is otherwise unfair to consumers, he may include proposals to remedy the position. The CPAC then reports to the Secretary of State whether it agrees with the proposals. If the Committee reports that it considers the Director General's proposals, broadly speaking, to be necessary, practicable and fair, the Secretary of State may make an order, subject to Parliamentary approval, banning or regulating the practice in question. This order is the third to be laid under these provisions of the Fair Trading Act and arises from a reference to the CPAC by the Director General. It deals with disguised business sales.

The reference covered one practice only—that of seeking to sell goods in the course of a business in a manner which did not reveal that they were being so sold. As the Committee explains, the practice is most widely seen in advertisements for goods for sale; for example, second-hand cars, furniture and electrical appliances. Traders advertise in such a way as to suggest that the seller is a private individual. The Committee agreed that the practice adversely affected the economic interests of consumers because it misled them about the status of the seller of the goods and, consequently, about the rights that they, the consumers, enjoyed. A consumer's rights to financial redress when goods are faulty are stronger against a trader than against a private individual and a consumer, misled by the practice and seeking redress, would assume or be advised that his rights were limited to those available against a private seller.

The Committee also generally agreed with the Director General's proposals for controlling the practice to which the order will give effect. A person seeking to sell goods in the course of a business will be required to make that fact clear in any advertisement about the sale of the goods. It will suffice if this is made clear from the content of the advertisement or from its format, size, place or manner of publication.

The order will, if approved, come into effect on 1st January 1978. This should not present any problems because the media and those advertising associations chiefly concerned have been given adequate warning by the Department of Prices and Consumer Protection. I conclude by emphasising that the practice which this order will control is often a deliberate attempt to mislead consumers through the use of classified advertisement columns but that this is done only by a tiny minority of traders. No honest trader is likely to object to its provisions, and I believe I am right in commending this order to your Lordships. I beg to move.

Moved, That the draft Business Advertisements (Disclosure) Order 1977, laid before the House on 29th July, be approved.—( Lord Oram.)

3.39 p.m.

My Lords, I think we are all most grateful to the noble Lord, Lord Oram, for so explicitly putting over the points in this order. From these Benches we very much welcome it. There is one particular point which I should like him to clarify. He has said that in some cases it is a calculated effort to mislead and I wonder whether that might not have been covered by the Trade Descriptions Act. Apart from that one point we wholeheartedly support this measure.

My Lords, I explained the procedure which is necessary to be gone through on reference by the Director General, and so on. I feel confident that at some point during that rather complex investigation, if it had been already covered in the way the noble Lord suggests, someone would have said so, and the fact that they did not makes me confident that this order is necessary.

On Question, Motion agreed to.

Counter-Inflation (Price Code) Order 1977

rose to move, That the Counter-Inflation (Price Code) Order 1977, laid before the House on 29th July, he approved. The noble Lord said: My Lords, this is an order to approve a revised Price Code which came into operation on 1st August. The Price Commission is required to ensure that it is implemented until 31st July next year.

The Government's policies for their continuing attack on inflation were outlined in the White Paper published at the end of July. In that White Paper, the Government made clear their view that the mastery of inflation was the pre-condition for success in returning to full employment. Measures were outlined giving effect to these policies. On earnings, the Government stated their clear duty to urge all concerned to base their approach to pay negotiations on getting inflation into single figures. They therefore urged that the general level of pay settlements should be moderate enough to secure that the national earnings increase is no more than 10 per cent.

Provided that the overall increase in earnings is held to this 10 per cent. figure during the current pay round, the Government stand by their forecasts, published at the end of October, that the annual rate of inflation will fall to around 6½ per cent. by the last quarter of 1978. This would at last bring us into line with the rates of inflation forecast for the other major industrialised countries. However, this only illustrates how important it is for the future prosperity of our economy, and of everybody in it, that we should achieve moderate results from the current pay round in line with the Government's guideline.

The September Retail Price Index figures—the latest available—provide solid evidence that the rate of inflation is on the way down. The annual rate of increase is down to 15¾ per cent. which is the lowest rate of increase this year, and the third successive monthly reduction, I cannot of course, predict what the October figures—to be published tomorrow—will show, but I do not think it will surprise your Lordships if they show that there has been a further fall in the annual rate of inflation.

As for the future, one of the best indicators of the rate of inflation in retail prices is the Wholesale Price Index. The prices at which goods will appear in the shops in a month or two's time are partly determined by the prices at which they are leaving the factories today. The Wholesale Price Index for October has been published. It shows that the price of outputs of all manufacturing industry rose by only ½ per cent. in October the second small monthly increase in succession. While the annual rate of increase at 17¾ per cent. is still, we would all agree, high, the solid improvement in this index is shown by the fact that it has risen by only 6 per cent. over the past six months and by just 2 per cent. over the past three months. However, the prices at which goods will be leaving the factories in a few further months' time, looking further ahead, are heavily influenced by the prices at which materials and fuel are entering them today. The Wholesale Price Index for inputs has fallen for six successive months and is just 2 per cent. up on its level of a year ago, reflecting the stability both of sterling and of commodity prices generally.

Your Lordships will recall that we debated the Price Commission Bill earlier this year. That Bill, now enacted, confers wider and more flexible powers on a reconstituted Price Commission. Under the new powers, the Price Commission is able to initiate its own investigations into price increases, prices and margins. Price increases may be frozen or partially restricted during these investigations. At the end of an investigation, the Commission may recommend to the Secretary of State that prices or margins should be restricted for periods of up to one year. The Act also allows the Secretary of State to direct the Commission to examine more general matters relating to prices or charges—such as the pricing practices in a sector of industry or commerce—and he may regulate prices in consequence of the Commission's reports. Parallel with these powers of investigation and examination is the duty of the Price Commission to ensure that the provisions of the Price Code are implemented.

Therefore, I now turn to the Price Code itself. Because it is only a single component of the wider prices policy machinery, we have been able to confine it to a much slimmer and simpler document compared with its immediate predecessor. I am sure your Lordships welcome that. We are now in a transitional period, and it is right that we should retain for a further year some broad controls contained in the Price Code, while the more flexible and selective policies set out in the Price Commission Act are beginning to take effect. The proposals for the Code were first issued as a Consultative Document, and all the representations received, whether or not they were accepted, were considered most carefully.

Your Lordships will wish me to draw to your attention the principal changes which have been made. The principal change made in the Code is the removal of the provisions imposing cost-related controls on manufacturing and service firms. This means that such firms are now subject only to the profit margin controls. The removal of the cost-related controls is permanent and Section 15 of the Price Commission Act contains a requirement to that effect. There is no doubt in our minds that the continued application of the cost controls would have meant rules which were inevitably arbitrary and indiscriminate.

Modifications have also been made to the margin controls. Paragraph 22 renews the Price Commission's discretion to permit revised reference levels for enterprises if it is satisfied that a change is justified. In exercising this discretion, however, the Commission is now required to have regard to the criteria listed in Section 2(2) of the 1977 Act. A similar provision in paragraph 40 requires the Commission to have regard to the same criteria in considering requests for adjustment of gross percentage margins for distributors.

These amendments go some way to aligning the principles governing the implementation of the Price Code to those underlying the 1977 Act. For manufacturers and service firms seeking relief for low profits, paragraph 23 provides that, as an alternative to a 12½ per cent. return on capital, a firm may have a reference level which would permit it to obtain a return on turnover of 3 per cent. instead of 2½ per cent. which it was under the earlier Code.

Additional changes have been made for distributors, principally in order to deal with specific difficulties which have arisen from the operation of the gross margin controls. The safeguard for net profit margins is improved to allow them to set gross margins up to 115 per cent. of base-level margins in order to obtain 85 per cent. of net profit margin reference levels. These figures compare with 110 per cent. and 80 per cent. respectively in the former Code. The definition of small distributors exempt from the 10 per cent. cut in gross margins has been revised so that retailers with annual sales of less than £600,000 and wholesalers with annual sales of less than £1,200,000 will now be exempt. The previous exemptions were set at £500,000 and £1 million respectively.

A limited number of prices and charges have been added to those already exempted from the Code and certain changes have been made to the investment provisions to take account of the ending of cost-related controls. Investment relief has been extended to the acquisition of existing industrial buildings, warehouses and shops which are for occupation by the enterprise claiming relief.

Finally, the Code contains a revised pay sanction. It provides for the disallowance of excessive remuneration in determining profit margins under the Code, where the pay limit has been exceeded. The pay limit in this context is the 12-month rule set out in Annex A to the White Paper The Attack on Inflation after 31 July 1977. Breaches of the previous pay limits are also subject to the sanction, but before applying it, the Price Commission is required to refer any question whether increased remuneration exceeds the pay limit, to the Secretary of State for Employment for determination.

My Lords, this order is intended to cover the period up to next July. Noble Lords will know already that, if the Government should wish to impose a statutory Price Code beyond that date, they will have to put forward proposals for new primary legislation: the 1977 Act makes quite clear that the Price Commission's duty to ensure that the Code is implemented does not extend beyond that date. In the meantime, however, we shall have an opportunity to assess the results of the Price Commission's wider work on investigations and examinations carried out under its new powers. For the current year, this order is an essential element of our counter-inflation policies. We have gone a long way to easing the straitjacket of the earlier price controls by removing the cost-related provisions of the Code. We have also effected improvements to the margin controls. We believe that we have reinforced the principle of en-deavouring to restrain prices and, at the same time, safeguarding and encouraging investment. My Lords, I beg to move.

Moved, That the Counter-Inflation (Price Code) Order 1977, laid before the House on 29th July, be approved.—( Lord Oram.)

3.55 p.m.

My Lords, dearly as I should like to do so it is certainly not my intention to turn this matter into a full-blown economic debate, because we had one of those only last week. However, under the cover of his normal clarity and courtesy we have, during the past 14 minutes or so, heard from the noble Lord, Lord Oram, a tremendous symphony of wishful thinking. If the Government look upon a falling rate of inflation based upon 15 per cent. or higher—those are the noble Lord's figures, not mine—as encouraging, I suggest that they need psychiatric rather than economic advice.

As the noble Lord has told us, the order substitutes a new Price Code for the previous Code which operated from 1st August 1976 to 1st August 1977. The legislation is, therefore, retrospective to the extent of three and a half months and it would be better, I suggest to noble Lords opposite, if we were able to consider these matters on a slightly more topical basis.

As is widely known, we on this side of the House oppose the principle of the Government's Price Code and its subsequent extension. In our view the Code has been shown to have had virtually no effect on prices and it is distributors rather than manufacturers who suffer. Although I agree with the noble Lord, Lord Oram, that we must welcome the Code in so far as it relaxes some of the provisions of its predecessor, we are extremely disappointed not to see more relief being given to distributors. Therefore, we find it damaging not only to general business confidence, but damaging in that it is highly selective. I suggest that the Code is especially dangerous during a period of high wage increases, that is to say of wage increases of about the 15 to 20 per cent. margin. We agree on all sides of the House that in the past two years profits have taken the greatest battering on record and that, of course, has had the predictable—and from our point of view the predicted—effects on unemployment.

Ministers have given frequent assurances that the last year of the Code was supposed to be its final year. The Secretary of State for Prices, Mr. Hattersley, has said that another year of margin control was to be a quid pro quo for a pay policy with the Labour unions. My Lords, there is not much of a pay policy left. During the economic debate last week I asked the noble Baroness, Lady Birk, whether she would give me details of any settlements whatever on any significant scale which had been achieved at under 10 per cent. She said that she would do so. However she has been unable to do so.

We also believe that the Price Code is operating ineffectively as regards its own costs. Will the Minister say whether he is satisfied with the cost effectiveness of the administration of the Code? Are any outside bodies—bodies which are not staffed by the Civil Service—involved in the administration and the financing of the Price Code and, therefore, adding to its expense?

4 p.m.

My Lords, we on these Benches should like to give a welcome to this Code, believing, as we do, that it is necessary to have control over prices, particularly during this period. We are glad to hear from the Minister the extent to which prices are falling, but we would strike a note of warning about the level of pay increases.

We must remind ourselves that the original intention was that, on average, no pay increase should exceed 10 per cent., and that means that the basic pay increases should be in single figures. It does not appear that, in fact, that is happening. It is now assumed that there will be a minimum increase of 10 per cent. for everyone. If this goes on, the optimistic figures which the Minister has given us are not likely to be justified, for prices can rise again only if pay increases rise very much above 10 per cent. For that reason, we are glad that the Code includes the possibility of a sanction on prices where the 12-month rule has been broken. In our view it is a pity that such a sanction cannot be operated where the 10 per cent. is also broken, because the failure to control rising wages could put the whole exercise and all that we have gained into reverse.

Although, of course, part of the reason for the pay increases above 10 per cent. is undoubtedly pressure from trade unions, there is no doubt that, in some circumstances, it also comes from a too easy—indeed, a willing—acquiescence by employers for the sake of convenience.

4.2 p.m.

My Lords, I should like to thank the noble Earl, Lord Gowrie, and the noble Baroness, Lady Seear, for their response to this order. The House will be grateful to the noble Earl for not wishing to launch upon a major economic debate. However, I shall reply briefly to some of the points that he made and make one brief comment on what the noble Baroness said.

The noble Earl suggested that I was engaging in wishful thinking on the basis of a level of inflation of 15 per cent. I did not base my optimism about the future on the existing level of inflation; I based it on the rate at which the situation is improving and I spelt out a number of statistics which indicate that that improvement is real and justifies us in looking to the future. Given the reservations to which the noble Baroness referred, we can look forward with optimism to an increasingly improving situation.

When the noble Earl referred to the necessity or otherwise for a Price Code this year, he overlooked the fact that we are in a transitional period with respect to prices policy. We are moving from the one system, which was a system of rather rigid controls, to the system based upon investigations and examinations by the Price Commission, which is a much more flexible system. But that system will need to take some time before it becomes fully operative and I suggest that there is the necessity for a Price Code during this current year to take account of the transitional situation.

The noble Earl then used the phrase, "There is not much of a pay policy left". I would at least urge him to consider that the 12-month rule is a very important element of pay policy and that continues. That has the support both of the Confederation of British Industry and the Trades Union Congress and, to my knowledge, there have been no significant breaches of the 12-month rule. Therefore, to that degree I believe that he was wrong in suggesting that the pay policy had pretty well disappeared.

He then asked about the administration of the Price Code. As I indicated in my opening remarks, it is the responsibility of the Price Commission and I suggest to him that as the Price Commission is newly constituted—it will shortly be reporting on the first three months of its work—before criticising it for being unduly expensive, bureaucratic or any of the things he was hinting at, we should allow a little time to see how it is working.

I thank the noble Baroness, Lady Seear, for her remarks and would agree with her that any optimism that I expressed with regard to the future is, of course, entirely conditional upon continuing success in achieving restraint so far as wage claims and settlements are concerned. I am entirely with her in that. Indeed, I think it is well known that my various ministerial colleagues have always stressed that. They have made it very clear that, although' we can see the probability of progress in relation to the cost of living, if there are excessive pay claims and pay settlements, then, indeed, inflation will begin roaring again. So far, we are holding the ring and we believe with confidence that we shall go on doing so. However, I accept what the noble Baroness says: it is a condition that there should be continued pay restraint.

On Question, Motion agreed to.

Highway Code

4.6 p.m.

rose to move, That this House approves the Code contained in pages 6 to 45 of the Highway Code, laid before the House on 20th July. The noble Baroness said: My Lords, this afternoon we are considering the fruits of a very long labour. The present version of the Highway Code was published in February 1969. During debates in this House and in another place before approval was given for its publication, noble Lords and Members were critical of the lack of opportunity given to them to express their views at a time which could have influenced the drafting of the Code. The Government of the day gave an assurance that such an opportunity would be provided before the Code was next revised.

In accordance with this assurance in January 1975, the Government published a Green Paper entitled, A Proposed New Highway Code. This served as a basis for our considerations and also for widespread consultation with interested organisations and members of the public. The Department of Transport prepared an amended draft of the Code in the light of the comments received on the Green Paper. This was included in the Paper for Parliamentary debate which your Lordships considered in December last year and which was also debated in another place in November last year.

When I opened the debate in this House, I explained the main changes in the text noble Lords then had before them—as compared with the text of the published Code and the earlier drafts. I am sure that your Lordships would not wish me to go over that ground again. Those noble Lords, who were present on that occasion—and I see many who were—will recall that we had a very full discussion. Many sensible and helpful points were made during the debate. Afterwards I wrote to those noble Lords whose suggestions I had not been able to deal with during our debate. I explained what we proposed to do about them. The Code that we are considering today—the final text at last—will therefore contain no surprises to Members of this House.

We have not, of course, changed the text to reflect all the points that were

made in the last year's debates. That would have been impossible. The Code as you now see it has been influenced by a long and widespread process of consultation. All those points raised by your Lordships were carefully considered. We have accepted many of the amendments suggested here and in another place and incorporated them in the text now before your Lordships' House. Inevitably, my Lords, we received many contradictory suggestions, and also many, which, although sound in themselves were not suitable for the Highway Code. I hope noble Lords will agree that our purpose today is not to debate points of detail—we have already done that—but to decide whether the new Highway Code should now be published.

There are, however, several other general points that I should like to make. There has been widespread and strong criticism of the cumbersome nature of the process for revising the Highway Code. This stems mainly from the need to obtain Parliamentary approval for any alteration to the main body of the Code, however small it may be. I said last year that the Government would consider how best to change this. Legislation would be needed to make any substantial amendment to the procedure, and we shall need to await an opportunity for this. There is however one small change that it is proposed to make now. We are being asked this afternoon to approve the Code between pages 6 and 45 of the document we have before us. Noble Lords will notice that this does not include the sections on traffic signs, signals and markings which are dealt with between pages 46 and 60. The corresponding part of the existing Code is in the body of the text approved by Parliament.

The signs illustrated in this section are only a selection of the more important signs in common use. It has been found during the life of the current Code that it would be desirable to vary the selection of important signs from time to time in order to keep the information in the Code up to date. The signs in this section—and any others that might be selected—already have the force of law because they are prescribed in regulations or are authorised for use in special circumstances. There is therefore no change in the degree of Parliament's control over traffic signs; the only difference will be that in future the selection of signs and markings shown in the Code can be altered to reflect the changing pattern and uses of different signs.

During our earlier debate several noble Lords asked about the price at which the Code will be sold. You will see that on the front cover of the copy now before us the price is shown as "nought pence". This does not, I am afraid, mean that they will be given away free. It means that until Parliament has approved the new Code, and the Stationery Office has obtained tenders for the bulk printing, the price cannot be determined. It is clear that the new version will cost more than the 15 pence which is the latest price of the current versions, but I do assure noble Lords that the increase will be kept as small as possible. In our earlier debate I said between 15p and 50p, and I have no reason to change my mind now, and hope that it will be nearer the 15p than the 50p.

We have waited a long time for the new Highway Code; many of your Lordships would say too long. When we laid the Code before Parliament in July, we hoped that it would be published by now; but unfortunately it was not possible to find time for debate before the summer recess. In commending the new Highway Code to your Lordships I would say it is our hope that, subject to the approval of your Lordships and of another place, it will be on sale to the public very early next year. I beg to move.

Moved, That this House approves the Code contained in pages 6 to 45 of the Highway Code, laid before the House on 20th July.— ( Baroness Stednian.)

4.16 p.m.

My Lords, I am sure that other noble Lords in this House will join me in complimenting the noble Baroness and her Department on the way in which this whole matter has been handled and on her admirable introduction of this Highway Code today. If one examines the new Highway Code it is clear that, as she has said, many of the constructive suggestions made by Members of this House and by Members in another place have been adopted. The long labour which she mentioned has, in my opinion, been successful. The Highway Code in its completed form also owes a great deal to the various voluntary organisations in the field of road safety; the RAC, the AA, RoSPA, and other such bodies. I am sure that your Lordships will wish to join me in paying tribute to the selfless and dedicated work of these organisations.

There are one or two specific points that I should like to make about the new Highway Code. First, there is the point raised by my honourable friend, Mr. Norman Fowler, in another place. He pointed out that, under the present law, any 17 year-old can walk out, buy a motor cycle, a pair of L plates and a provisional licence. He can put the licence in his pocket and the L plates on his motor cycle, and drive straight off. I realise that it is not practical at the moment to make pre-road training for motor cyclists compulsory. En large areas of the country the necessary facilities do not exist. But surely everything possible ought to be done to encourage new motor cyclists to take such training. Excellent schemes exist. I should like to draw your Lordships' attention to the training programme organised under the auspices of the RAC/ACU. Frankly, I think that it is regrettable that the opportunity was not taken to mention this and other schemes in the new guide.

Another point concerns horses. The section of the new Code dealing with children is admirably written. For instance, drivers are instructed to take great care when passing near ice cream vans because children are much more interested in ice cream than they are in road safety. That is a very true observation, and because of the pithy form in which it is expressed in the Code it stays in the mind.

The British Field Sports Society suggested a form of words to advise motorists how to behave in the presence of horses. As you may remember, I read out their proposed draft when we were debating the Green Paper. I think I probably agree that their draft was too long for inclusion in the Code, but one sentence in particular stayed in my mind:
"Remember that the horse is an animal of spirit, and that your car is a machine within the competence of human control".
I am not suggesting that this is quite as memorable as the point about children and ice cream vans, but it is unfortunate that it is not possible somehow to include it in the new Code.

Of course, my noble friend Lord Lucas of Chilworth certainly had a point when he drew attention in the last debate to the great length of the new Highway Code. In its present form, the Highway Code is taking on more and more of the dimensions of a manual and losing those of a pocket book which is easy of reference. Frankly, I do not know how we can deal with this problem. I cannot think of anything in the new Code which ought to be excluded. I have already suggested two points which I think ought to have been included, and I am sure that other noble Lords will draw attention to further points in the course of the debate.

There was a time no doubt when it was possible to summarise the Highway Code in two or three sentences so that a motor car could proceed at a maximum of four miles per hour behind a man with a red flag, but there have been some developments in motoring since, and today we require rather greater length. I have one suggestion which might go some way to meeting my noble friend's point. It is to provide an index at the end of the Highway Code. Although there is an excellent summary of contents at the beginning, and full cross-referencing throughout the text, it may be that an index would be of use.

We know that the evidence suggests that, if seat belt wearing levels could be raised from 30 per cent. to 90 per cent. we could anticipate the prevention of the order of 1,000 deaths and 12,000 serious bodily injuries per year. I should like to agree and to draw attention to the fact that the section on seat belts in the guide is admirably expressed, and I would commend it to every motorist in the land.

I have just three small points to mention before I sit down. First, can the noble Baroness advise us as to whether she or her Department have come to any decision about the method of adopting further changes in the Highway Code? The suggestion was made that the Negative Resolution procedure might be used. There are obviously difficulties here. We might feel that changes under this procedure would deprive us of the opportunity to discuss the Code in its entirety. Also, there might be difficulty in establish ing exactly what the Highway Code said for legal purposes. Although the Code does not have the force of law, magistrates might reasonably be reluctant to bring in a conviction if a motorist or his solicitor could claim that the offence occurred simply because the driver's edition of the Highway Code was three months out of date.

Secondly, has the noble Baroness any further proposals on the vexed question of encouraging motorists actually to read the Code, which is surely the crux of the matter? However splendid a Code we produce, the whole exercise becomes totally pointless if it is merely another of the great unread classics. In the Green Paper debate I suggested that motor manufacturers should be required to issue a copy of the Highway Code along with the car instruction manual and that the police should be empowered to make a motorist produce his copy of the Highway Code as well as his driving licence and certificate of insurance, but of course none of this would ensure that the Code was read. The third point I was going to raise, about the cost of the new Code, the noble Baroness has answered. I have been slightly guilty of disobeying the noble Baroness's injunction not to mention details, but I thought it worth while to point out these items again to record my advice just in case it might become incorporated in any revised edition. In the meantime, I thoroughly endorse the Code and commend it to your Lordships.

4.22 p.m.

My Lords, I apologise for joining the fray so late in the debate. I was not present for the 9th December debate, although I read the report of it in Hansard and discovered that nearly every point I would have raised was raised by those who took part. I compliment everyone who took part in that debate, particularly the noble Baroness, Lady Stedman, who handled it so competently, especially as this is a very emotive subject and we all have different views, some rather radical, about what should be included. However, it is a Code and if it covered all the legal points required of a motorist it would run to many volumes.

Driving is a skill and not a gift. Some years ago I achieved a certain amount of success as a racing driver. Unfortunately the same amount of effort applied to learning the piano has not done quite so well. As I say, I believe it is a skill, and something that has been overlooked—this is possibly not the moment to mention it—is that the driving test is fundamentally too easy and is not a true enough test of skill; that is why there are so many accidents. But that is not part of this debate and I will keep to a couple of points.

I echo what my noble friend Lord Mowbray and Stourton said about the wearing of seat belts, especially in view of the figures; namely, that more than 1,000 lives per year as a minimum could be saved. It seems extraordinary that this valuable piece of advice is stuck away in Rule 28 in only one small sentence. More prominence should have been given to something so important, and it should have been dealt with in large letters.

Coming to Rule 29, I speak as a motorcyclist who arrived at your Lordships' House today on a motorbike and, hopefully, will depart on one later. It says in Rule 29 that motorcyclists should wear light coloured or reflective clothing, and while I wholeheartedly endorse that, one addition could have been made—something which has become quite common practice—and that is the use of the main lights on motorbikes during daylight hours. I have been nearly sideswiped a couple of times and I recall the driver of one vehicle who nearly took me off saying, "Thank goodness you had your lights on. I hadn't seen you". That would be an important step forward which could be taken.

Lord Mowbray and Stourton mentioned sundry driving schemes and I believe the Government have come up with a new scheme. I am not certain whether it is compulsory, but I believe it should be, and presumably it could be done by a form in the logbook at the back of a provisional licence. However, I do not see how that would get by the rule which allows a car licence holder to drive a moped which has single gears up to 50 cc, yet they are possibly the people who need more education about motorcycles than people starting to ride for the first time.

I agree that the Highway Code should be quite long; as I say, driving is a complex matter and as the roads become more congested it becomes more complex. I do not see how the Code could be made any shorter and it covers fairly comprehensively most situations that are likely to arise for the poor motorist. I should have liked to have seen a section showing the most common causes of accidents with approximate percentages. New drivers reading the Code—these are the people it is mostly aimed at—are presented with some 185 rules with numerous subsections and they are bound to be a little confused, in spite of what their driving instructors (who, after all, are mainly concerned with getting them through the driving test) have told them about the most hazardous situations they will face.

If a section showed that turning right was infinitely more dangerous than turning left, which I believe to be the case, people might take more care when turning right compared with turning left. However, it is a bit late in the day to bring that up. I hope the Highway Code will be regularly revised and that we shall have an opportunity to discuss it at some time in the not too distant future. I would simply add that the Highway Code is an invaluable addition to road safety, provided, of course, it is read.

4.27 p.m.

My Lords, in company with the noble Earl, Lord Denbigh, I too apologise for joining in the fray so late in the day. I shall endeavour to confine my criticisms not to points of detail that cannot be changed; if I do, I will refer to them quickly. The Highway Code is a substantial and difficult document. My last child, a girl of 18, is now taking driving lessons and I think she will have a great task in assimilating it. I do not complain about the quantity, just that it is not well arranged. It is in parts confusing, in parts deficient and in parts wrong.

I will deal first with one that is wrong. The cover shows the correct crossing of a roundabout when going forward. However, that is totally contradicted by a most dangerous illustration on page 27, which certainly does not show two separate lanes. It shows double banking on a single lane crossing, and that is one of the worst habits in summer time when traffic is coming in both directions; one gets queue-jumping at the roundabout and because traffic coming in the opposite direction leaves no room for two lines of traffic, there is cutting in and jostling at the end of it. The picture is wrong. There is not so much wrong with the statement, just that the picture is wrong and in contradiction to the cover, which is right.

Secondly, consider the instructions that are given. They are obviously the composition of many people; there are jaunty and peremptory instructions to cyclists and, in other cases, suave advice. There is complete confusion throughout the document about what is and what is not the rule. Mandatory warnings and advisory comments are all so confused that one does not know which is which. What action, if one does not comply with the rule, breaks the law, but may be taken into account if one has an accident and goes before the magistrates? And what is merely good advice? It is not possible to distinguish. The noble Earl who has just spoken referred to fluorescent clothing. I am a cyclist myself. I have done my 40, 60, 100 miles a day, and I am, with difficulty, taking it up again owing to the cost of petrol. What is my duty if I come to this House on a bicycle? Must I wear fluorescent clothing? Is that mandatory, advisory, or what? That is the kind of situation which proliferates. I give it only as an example.

There are matters which are omitted. Flashing lights are referred to. I think that the only legitimate signal they indicate is. "I am here", but in practice flashing lights are used for two different signals, and that ought to be dealt with. One is: "I am here, get out of my way". I am not saying what ought to happen, but what does happen. The other use of flashing lights is where an oncoming motorist intends to pull up and give priority to another motorist, and his signal of flashing lights means: "I give way; come on". Everybody knows that, but it is not referred to. It is no good giving an order as to what should be done unless one condemns as wrong what is a common practice.

I have a whole list of minor items. There is a total omission so far as speedometers are concerned. Speed is the greatest killer. I cannot find any instruction about the assistance of having a speedometer.

Almost everything else in the car is mentioned, but not the speedometer. I am among the 80 per cent. who try to drive within the legal speed limit. My eye is constantly on the speedometer. I do not believe that, with the variations of speed from motorways to country lanes, it is possible to keep within the speed limits unless the speedometer is in good order. After being on a motorway for some time, it is only too easy to think that a speed of 45 miles an hour is only 30 miles an hour. You look at your speedometer and see with horror the pace at which you are going. I am sure that everybody knows this.

There is a small item about stopping distance, under, I think, Rule 47, where the rule of thumb is expressed in yards, but the table immediately afterwards is in feet. This is a very minor matter, but it involves the kind of confusion that ought to be eliminated. Perhaps all the distances should be expressed in metres and millimetres. One is told in Rule 2 that it is safer to walk on the right of the road if one is a foot passenger. According to Rule 140, it is the duty of a horse rider to ride on the left. The opposite used to be the case. I do not know whether it should be said that it is safer to walk on the right of the road. Why tell the pedestrian that he is safer walking facing the traffic on the right, and then tell the horseman that he must go on the left without mentioning whether or not he is safer in that position? I am sure that these points have been argued before, and I do not want to dwell on them, but there is a contradiction between those two rules.

I came here with a special feeling of urgency regarding the horseman, and here I join with the noble Lord, Lord Mowbray and Stourton. He said that he wished that something further had been said about the horse. I think that the entire section of the Code dealing with animals has been badly handled, and what should be done in the case of different classes of animals is not adequately explained. Is it possible that point could be introduced, briefly stating that respect for the horseman is a duty upon the motorist? The only point I have seen regarding this—I think it is in Rule 140—relates to a duty on the man in charge of a horse to control his horse in traffic. That is wrong; that is bias of the wrong kind. That cannot be insisted upon.

I should like to give an illustration here. I went to ride in the Coronation Procession, and I was to be nine hours in the saddle. I took over a black gelding from the Queen's Bays. A friend of mine who had trained it, said to me:
"This animal is not a beauty, but we guarantee that it is quiet. We have had massed bands marching past it, and it doesn't turn a hair."
That animal was quiet until it got to Birdcage Walk. I went all over that part of London that day, and from that time onwards it was disturbed by something for which it had not been trained—the clapping and cheering of children. It jigged for nine hours. It never stopped jigging. I went backwards down Whitehall, and sideways along the Victoria Embankment. It was not my fault; it was not the fault of the Queen's Bays.

There should be a rule in the Code to make the motorist give way to the horseman. This summer, I have watched several riders—on one occasion it happened three times in one day—waiting and waiting to cross a tourist road where nobody bothered to let them through. When I stopped to let them through they were so nearly asleep that I had to shout, "Wake up! Your chance has come". And over they went.

Here, I must declare an interest. I have two daughters, and two young animals which they are training. We live in a built-up area near Crawley, and I am rather shocked at the disrespect shown to horses these days. Let us bear in mind that there are now more horsemen than there are football players. The horse is coming back—and a good thing too. One uses up energy which is renewable for ever and ever.

4.37 p.m.

My Lords, what a Code! It has 70 pages, some of them in extremely small print. This has been referred to already by two noble Lords, so I had better confess at once that I am personally responsible for the inclusion of no fewer than 11 extra words, as compared with the prototype Code which we discussed in December. These words concern a point which I raised at the time; namely, that there was no mention of learner drivers not being allowed on motorways. After a somewhat unfavourable early reception, it has been agreed by the powers-that-be that something should be included, and so there are two words extra in one place in the Code and nine in another. Having apologised for that extra length for which I was responsible, I should say that I am very grateful that that inclusion has been made.

I made several suggestions on 9th December, and in the middle of February I received a letter from the noble Baroness. I have the letter here. It is couched in beautiful grammar, with impeccable punctuation, and it is set out with the kindly courtesy that one has become accustomed to expect from her. But as I expected, the noble Baroness and her minions threw out virtually everything that I had said, on some excuse or another. But there was one suggestion that I had made which she did not mention in her letter, but which has been complied with in the new version. In December I referred to the fact that in the Code we were then discussing, the illustration of the red light was not red at all. I think that I referred to it as an anaemic-looking dot. I am now delighted to see that the noble Baroness has persuaded Her Majesty's Stationery Office to print every red light in the most brilliant red that anyone ever saw, and she is to be congratulated upon getting the Stationery Office to do that.

My Lords, in her letter the noble Baroness talks about my suggestion that there should be incorporated in the Highway Code the fact that "L" drivers are not allowed on motorways. She says that they are looking into the possibility of doing that, but adds that it is included in the full list given in "The law's demands". I also made another suggestion, and that was that, where it says that small motorcycles are not allowed on motorways, then, for the sake of the poor motorcyclist, it should be defined what is and what is not a small motorcycle. In regard to that, the noble Baroness said:
"I see no need, however, to define a small motorcycle in this rule since this is already done in 'The law's demands '".
My Lords, I had no inkling what "The law's demands" were until the other day, when I found them in this new document. If any of your Lordships have a copy and turn to page 61, it will be seen that there is a large heading "The law's demand" and that underneath there are listed no fewer than 23 Acts and regulations. If that means that, for anything which is not itemised in the Code, if you are not a Member of your Lordships' House or of another place then you have got to buy 23 Acts and regulations, nobody is going to do it, so you will not know where you are. It is too late to alter anything now, but, together with something I am just going to mention, perhaps that can be I thought of next time, as to what is or what is not a small motorcycle.

Now for the future. This is—and other noble Lords have said the same thing—a very long document. It appears from past history that we shall not have a revised one for another eight or nine years, by which time the noble Baroness will probably not be where she is now. She might be Chancellor of the Exchequer; she might be Prime Minister; she might even be sitting on the Benches over here. We do not know. But possibly in her Department there is a file in which this suggestion could be fossilised for reference when the next Highway Code is produced. My suggestion, which concerns shortness—this document really is too long for all and sundry to read—is that there should be three separate little documents, one for the motorist, one for the cyclist and one for the pedestrian. I think that would make it more certain that people would read what applies to them.

4.43 p.m.

My Lords, this is too good an opportunity not to intervene with one or two small points, but I have warned my noble friend that I will be brief. In the first place, there is reference to the pelican crossing, and I would implore my noble friend to ask her Department to look again—we have raised this before—at the fact that it is virtually impossible for blind persons to get across a pelican crossing before the light stops flashing. They have to wait for the indication; they have to wait for the sound. I have tested several of these crossings, and, though I move very smartly across the road, in most cases it is virtually impossible to get totally across the road before the lights revert to green. Most motorists are very reasonable about this, and I notice the injunction is:

"Do not harass pedestrians by revving your engines".
But there is always the kind of motorist who will take notice of something only if it is absolutely mandatory, and I would ask my noble friend and her Department to look at this. Pelican crossings are in great use now, and they certainly do not give enough time for a disabled person, or indeed an elderly person, to get across.

In relation to the sign for the disabled, I would again ask my noble friend if she will look at the fact that there seems to be a curiously informal method of issuing these signs. It is very tempting to have a badge on the back which says "Disabled" if you get special parking facilities, even though you may carry dear Aunt Mabel (who, it is true, is disabled) only about once a year. There is no doubt about it—and, again I have recently had letters from doctors—that there is a misuse of this label. It is a very valuable label, intended for people who are disabled and for no one else, as I understand it, unless you are regularly carrying a disabled passenger. I would hope that the Department will look at this, though in fact the badges appear to be issued through the Department of Health and Social Services. I was very interested to see that, in this booklet, we have nice clear print until we come to "The law's demands", when for some reason it is written much smaller. This is probably to help those who come before us in the courts to say, "I could not really read that part of it, and therefore I was not quite sure whether I was breaking the law or not".

Finally, my Lords, on theft. There are several references in here to the car when it is in motion, but, of course, a car also has to be stationary, and more and more have cars to be put into car parks. One of the suggestions in here about the prevention of theft, which is reasonable, says:
"Lock valuables in the boot if you cannot take them with you".
I am very sorry to tell my noble friend that I have had three cases in the last week in which people have done just that, have locked their valuables in the boot of their car, have left the car in a multi-storey car park and, when they have returned, have found the valuables taken. The car park authorities absolve themselves of all responsibility, and the police are unable to act; but the fact remains that here is a new area of theft. I would therefore ask that car parks, which are now very much part of the motorist's life, should also in some way be subject to some kind of investigation—jurisdiction, if you like, or legislation. There is a curious informality even about the kind of people who are able to set these up, and I feel that motorists, if they are paying quite high prices to park their cars, deserve some kind of protection. I am delighted to have this Code. I hope it is going to be very reasonably priced because it should be in the hands, not only of every motorist but of every pedestrian, too.

4.47 p.m.

My Lords, I am most grateful to those Members who have taken part in our discussion this afternoon, and for the way in which the new Highway Code has been received. I should like to follow the last remark made by my noble friend Lady Phillips by saying that the Highway Code is not intended merely for learner drivers; it is not intended merely for motorcyclists; it is not intended merely for cyclists and it is not intended merely for pedestrians. There is something in the Highway Code which is the affair and the concern of each one of us, whatever our form of transport, whether it be two legs, two wheels, four wheels, or even a horse. This is something which we hope all sections of the community will look at and will try to make part of their general reading.

The noble Lord, Lord Mowbray, came back to the point of training for young motorcyclists. I am sure he knows that the Department are concerned about the increasing accident rate among young motorcyclists, and we are going to run a publicity campaign next year which will be aimed at new riders and will encourage them to be trained. We already send out leaflets which mention the RAC scheme to all first applicants for a provisional licence to drive a motorcycle. Any other helpful suggestions which noble Lords can make which will enable us to get at these young people, and get them properly trained and taught how to handle their machines, we shall receive most gratefully.

We have not yet decided on the final or precise form of changes in the procedure for revising the Code. As I said when I was introducing the order it is a matter needing some legislative time, which we have not got; but we hope to be able to bring in some sensible means of revising the Code without having to go to all the trouble that we have had to go to this time.

There will be a publicity campaign to encourage drivers to use the Code as soon as the new version is published. The status of the Code in law—a point referred to by several noble Lords—is explained at the bottom of page 5. I apologise to my noble friend Lady Phillips: it is in very small print. Then, at the end we have the section on "The law's demands". I am sorry, but if the noble Viscount, Lord Monck, had gone on a little further than all these Acts of Parliament he would have seen that they are detailed (again in small print) on the following four or five pages. He need not buy all the Acts of Parliament. We tell him the section that is relevant.

The noble Lord, Lord Mowbray and Stourton, referred to publicity. We are using television and we shall be using the Press and leaflets and so on and shall give what publicity is possible once the new Code is published. We have arranged for certain short television films to come on and perhaps we can take up some of the points that noble Lords have made about aiming a short film at a specific group of people concerned with using the Code. I am sorry that the noble Earl, Lord Denbigh, was not here to join us in our major debate but we appreciate his comments this afternoon. We accept that driving is a skill and I made a note of his comments on the driving test. It is not absolutely relevant to the matter of the Highway Code, but we shall certainly have a look at it in the Department and see whether we can take up any of his points.

On the question of seat belts, we had two forays into this field last year, neither of them very successful. I accept that perhaps we have not given as much emphasis to seat belts as we might have done, but until this House and another place have made up their minds on them it is difficult for us to place a tremendous amount of emphasis on the matter, whatever may be our Departmental or personal views. The noble Earl referred to Rule 29; and here I must declare an interest. Strange as it may seem, I, too, ride a moped—not to this House but to the station to get me to the House. I hope I ride it competently and I am usually wearing something light so as to be seen. I have noticed the greater use of main lights in daylight hours. Personally, I should have thought it was a sensible thing to do. Certainly, we will look at it to see whether, perhaps at some future time, we can issue some advice on that subject.

The noble Earl, Lord Lytton, was also, unfortunately, not here at our earlier debate but I was grateful for his contribution. He was a little concerned about which of our instructions were mandatory and which advisory. We have prefaced all the mandatory ones by the word "must"—you must do this or you must do that—as well as detailing what are the law's demands at the end of the Code. I accept his comments that there are certain private or public codes of flashing lights which seem to have grown up over the country which seem to imply certain messages to other drivers; but I must again point out that we deplore the use of flashing lights except as detailed in the Code.

The question about speedometers, I must confess, has taken me by surprise. I cannot answer that question at the moment. If the noble Earl will forgive me, I will write to him after I have had discussions on it. On the question of publicity about horse-riders, again, we had a very long discussion about this at the earlier stage. I hope that we have got it right this time and that it is something that horse-riders, those leading horses and those riding machines or walking will take note of. I noted the question of the noble Viscount, Lord Monck, as to why we could not have a shorter Code, or three Codes, one for motorists, one for cyclists and one for pedestrians. One always assumes that, one day, the pedestrian may progress to two or four wheels and the cyclist to a car. I believe that it is much better to have a general picture available for all to see.

My Lords, may I emphasise one point which the noble Baroness mentioned about horses and horse-riding? I should like to say that, although I and my family have no personal interest, I knew three people very well who are now dead because motorists or lorry drivers, as the case may have been, did not behave in a sensible manner when passing those friends when they were on horses. My friends are now dead. I can give the noble Baroness their names later, if she wishes. I speak from sincere personal feelings.

My Lords, I take the noble Lord's point. This is one of the things that we might try to include in our television or Press publicity in order to give more emphasis to it. The noble Viscount, Lord Monck, referred to the fact that we had tried to deal with all his points. Our aim at the Department of Transport is to please. The noble Viscount has two letters and he has also now got good strong red lights in this Code. I hope that that means he will accept that we take notice of any comments made in this House.

My noble friend Lady Phillips referred to pelican crossings and to blind people. 1, too, have had this problem brought to me so I know that there are difficulties about it. I shall certainly ask the Department to look at the timing mechanism and see what guidance they can give to local authorities in the use or, perhaps, the alteration of pelican crossings. Also, we all of us deplore this misuse of "disabled" symbols. As my noble friend said, this is something rather difficult to deal with. The DHSS, the local authorities and all kinds of people are involved. We urge people not to use the "disabled" symbol when they are not themselves disabled or driving disabled people. It is very wrong that fit and well people should be driving around, taking advantage of the special parking spaces and facilities as if they were persons who were disabled.

I also noted the point made by my noble friend about thefts from car parks. This, again, is not strictly within the purview of the Highway Code except that we do advise people to lock articles in their boots; and now, apparently, things vanish from boots. It is something that we must ask my right honourable friend to look at again to see whether we can give any other advice and perhaps consult with those Departments concerned.

My Lords, I am grateful for the way in which everybody has received the order. I hope that it has the same sort of passage in another place and that we shall soon see it printed and in general distribution.

On Question, Motion agreed to.

Ecc: Forty-Second Report—Criminal Law

4.56 p.m.

rose to move, That this House takes note of the Report of the European Communities Committee on Draft Treaties concerning the protection under criminal law of the financial interests of the Communities, and the application of criminal law in respect of Community servants (R/2043/76) (Forty-Second Report of last session (HL 228)). The noble and learned Lord said: My Lords, the two draft Treaties and Protocols which are the subject of the Forty-second Report of the Select Committee on the European Communities are the first significant intrusions of Community law into the criminal law of the Member-States. The existing Treaties are practically silent upon the subject. I can only recall one insignificant exception about perjury before the European Court. Of course, a Community criminal law which is distinct from the criminal law of Member-States is quite impossible without erecting the whole paraphernalia of the administration of justice, the courts, the prison service indeed, to carry out the sentences.

But Article 5 of the Treaty of Rome places upon all Member-States the duty to take appropriate measures to see that obligations under the Treaty, regulations and Directives are fulfilled. Whether their attempts to enforce the provisions of the Treaty, regulations and the like are accompanied by criminal sanctions is a matter for the discretion of the individual Member-States. But they do that either, in the case of regulations, by supplementary domestic legislation imposing criminal sanctions or, in the case of Directives, by putting the criminal sanctions in their own law. This we have clone already in a number of cases mostly dealing with comparatively minor transgressions of the Community law—for example, failing to comply with the requirements of egg packing, driving too many hours, and such things.

The first draft Treaty amends Article 5 of the Treaty of Rome by placing on Member-States the additional duty to protect by criminal law the financial interests of the Community and to prosecute infringements of Treaty legislation. It is to the Protocol that one has to look to see how this is to be done. The second draft Treaty and Protocol deal with offences by and against servants and officials of the Community, and that involves a somewhat similar amendment to the Merger Treaty. But it is the Protocols which are the important part of this new provision of Community law which is suggested by the Treaties. Both of the Treaties require the Member-States to incorporate in their own criminal law some substantive offences if they are not already included in it. As in the case of this country, nearly all of them are.

Under the first Treaty the Protocol deals with substantive offences relating to defrauding the Community or Community funds and requires each Member-State to treat them in its criminal law as it would with its own Government powers. This would require little, if any, alteration in the existing criminal law of this country, though it might involve some amendments of the law in other Member-States. Under the Protocol to the second Treaty it deals with offences of bribery, forgery and misappropriation of funds by Community officials and the disclosure of official information, and it requires Member-States to penalise those offences by Community officials in the same way as if they had been committed by Government officials in this country. That part of it would require very little alteration in the existing criminal law here because they are dealt with in that way, but it would require some amendment of the Official Secrets Act to apply to Community officials—extension from Government officials to Community officials as well. It also requires these matters to be dealt with in the same way regarding offences of persons who are not officials but who obstruct them in the performance of their duties, or bribe or attempt to corrupt them. Again, it is required that those offences should be treated in the same way as similar offences committed in relation to Government service; and again little or no alteration would be required in the criminal law of the United Kingdom.

The proposals regarding the substantive criminal law which are contained in the Protocols to the Treaties are uncontroversial. They can be accepted and welcomed and, as I say, will make little, if any, difference to the existing law here. The difficulties presented by these Protocols are the procedural requirements which they contain, and those procedural require-merits deal with what is called transferring criminal proceedings from one State to another. If one looks at the matter in the terms of United Kingdom law it means transferring jurisdiction to try criminal offences from where it would lie before the Protocol to an additional venue, and would require this country to accept jurisdiction in respect of criminal offences which up to now is not accepted by our law.

In the Protocol to the first Treaty the scope of the procedural requirements is very much wider than the substantive offences with which the Protocol deals. It covers all infringements of any regulation or of any Directive of the Treaty which is punishable under the criminal law of the Member-State concerned. That includes comparatively trivial offences punishable by a small fine under our law. I have already given examples—eggs, driving, and minor infringements of regulations, which may properly be dealt with—or at least so it was thought by the Parliament of the United Kingdom—by a relatively minor penalty. This Protocol provides for the transfer of prosecution for those offences from one State to another.

In the ordinary way the fundamental principle of criminal jurisdiction—which I can almost say is recognised throughout the world—is that the jurisdiction to try offences lies with the State where the offence is committed. This Protocol provides that if the State where the offence is committed is unable to try the case, because the offender at the time is not within the country, and is unable to obtain extradition from the country where the offender is to be found, it may request the State where he is to be found, or where he habitually resides, to prosecute him. In that case the State must treat the offence as if it had been committed under its own law and within its own territory.

There are three criticisms to be made of those proposals. First, the transfer to another State where the offence was not committed is available only if extradition is impossible. That would either be because the offence was not an extradictable offence or, as in the case of Italy and Germany, where there are provisions in the Constitution which prevent the extradition of a national of that country. There are constitutional difficulties in the way of overcoming that. The Select Committee suggests that extradition or transfer should be available wherever it is more convenient that the case should be tried in one of the States where the offender is present, or in the State where the offence was committed. Generally speaking, one imagines that witnesses will be in the State where the offence was committed and it will be most convenient to try the case there. There might be circumstances in which witnesses are available in the place where the offender is to be found. The Committee really see no reason why that should not be dealt with on balance of convenience rather than under rigid rules.

The second criticism—and it is an important one—is this: whether you adopt the system of extradition or of transfer, this will be, as all experience shows, an expensive and time-consuming process—justified, I venture to suggest, only in cases where the offence is a relatively serious one. To adopt it in the case of trivial offences appears to the Select Committee to be quite unjustified on rational grounds. What we would propose is that these provisions as to transfer should be restricted to the offences dealt with in the Protocol itself—and they are serious offences, such as defrauding the funds of the Community, and the like—and, possibly, to take power to add to those to which the procedural provisions will apply additional serious offences by Directive from the Council, or the like. The third, a minor one, is that transfer to the State of the habitual residence of the offender seems to us to be unnecessary and to be quite contrary to principle. So far as this country was the State of habitual residence of the offender, unless he was here as well, we simply could not do that one.

Let me deal shortly with the second Protocol. Here the procedures for transfer apply only to the substantive offences offences by and against Community officials, which are dealt with in the Protocol. The procedural provisions, however, for reasons which are far from apparent, are wholly different from those in the first Protocol. They are very complicated and, as I say, there is no discernible reason why this should be different from the others. They appear to us to be contrary to the general principles upon which criminal jurisdiction is exercised. What they provide is that the primary jurisdition to try the offence, wherever it is committee and wherever the offender may be, shall be vested in the State of his nationality. I would venture to suggest there can be no possible justification for that.

That State, however, may request the State where the offence occurred or the State of habitual residence—we are coming back to habitual residence again—to start proceedings against him: that is, the State which on ordinary principles of jurisdictional criminal law would be the natural State to do it. But it would appear, though it is not quite clear about this, that unless so requested by the State of nationality, there is no jurisdiction under the Protocol to try him here, unless he is also found in the State where the offence was committeed, in which case that State may demand transfer.

My Lords, what happens if he is not a national of any of the Community countries?

My Lords, he is then tried in Luxembourg. I did not read that out because it did not seem to be of great importance to us here, but he is in fact tried in Luxembourg. One other provision is important; that is, regarding the substantive offences created by the Protocol, each of the Member States must make them extraditable. That would appear to make it necessary for Italy and Germany to overcome their constitutional objections to doing that in the case of their own nationals.

May I state briefly the criticisms of the proposals in this Protocol. It is indeed a jurisdictional "dog's dinner". There is no sound reason why the primary jurisdiction should be in the State of the nationality of the offender. There is no sound reason that we can see why the jurisdictional provisions in this Protocol should be different from those in the other. Finally—and this is a particular difficulty in the United Kingdom—we cannot prosecute unless the defendant is present in this country. This is a question not of jurisdiction but of how we conduct criminal trials. The defendant has to be present and the evidence has to be given in front of him. Therefore extradition will be necessary if we are ever requested under the second one to try someone not present.

My Lords, I apologise for interrupting, but I find this interesting. It may be absolutely elementary, but I should like some help. Obviously, as the Community grows, the movement of transport on the inter-national juggernauts will increase. Assuming that a juggernaut is involved in an accident in, say, South Wales, there might he several people who are injured or killed, and the driver takes his load and gets back to his place of origin. How do we> deal with such a case?

My Lords, you cannot do it at the moment unless it is an extraditable offence. If it were thought appropriate to make that kind of offence an extraditable offence or even to be one of those listed, as I suggested, added to the offences in the original first Protocol, that could be done. It would then become extraditable and one would be able to deal with it: I do not think there are going to be any difficulties about that. Let me emphasise this: in inviting the House to take note of these two proposed draft Treaties and in criticising them as I have, the criticism which we have brought forward is intended to be constructive, because it seems to us that we can turn this from a "dog's dinner" into a rational scheme for dealing with these kind of offences which occur in various parts of the Common Market.

What we would propose can be put very simply. First, the provisions for transfer should be limited to serious offences, whether by extradition or by the transfer provisions—certainly those created under the substantive provisions of the Protocol and, I would venture to suggest, power to add to them by Directive subsequently when the need was shown to arise. Secondly, all crimes which are serious ones which would fall within it, and not merely those in the second Protocol, should be made extraditable by each of the Member States so as to give the possibility of extradition to the country where the offence occurred. Finally, the jurisdiction to try the offences to which the Protocols relate should be limited to the State where the offence is committed, or by transfer, to the State where the offender is to be found. These are simple provisions; they are rational provisions; they are close to the generally accepted principles of jurisdiction in criminal law, and I hope that our representative on the Council of Ministers will suggest these amendments to what, if they were made, would make a valuable and sensible addition to Community law. My Lords, I beg to move.

Moved, That this House takes note of the Report of the European Communities Committee on Draft Treaties concerning the protection under criminal law of the financial interests of the Communities, and the application of criminal law in respect of Community servants (R/2043/76) (Forty-second Report of last session (HL 228)).—( Lord Diplock.)

5.20 p.m.

My Lords, the House owes a debt of gratitude not only to the Members of the Select Committee, who considered the important and complex problems relating to criminal law and the European Community Treaties, but more particularly, as I am sure noble Lords will agree, to the noble and learned Lord, Lord Diplock, for his most clear and comprehensive introduction to the subject. In fact, in some remarkable way, he manages to make it seem very simple and easy to understand, and it is only when one comes to read the documents oneself that one realises how extremely complex and difficult it all is. But we are most grateful to the noble and learned Lord for his remarkably clear exposition, and of course for the very helpful and constructive comments which he has made on the problems that have been created by the Protocols.

Speaking personally, I would certainly humbly endorse the three major recommendations that he has made, which I think will contribute to making the whole situation very much easier and more acceptable for all Member States, not only the United Kingdom. It is, of course, axiomatic that where a set of rules—in this case, economic rules—are introduced, non-observance becomes subject to some form of sanctions, and for these sanctions to be effective there must be some equitable and practicable method of enforcement. If the rules regulating economic relations between Member States of the European Community are to be respected, not only must the methods of control of Community finances be more efficient, but also the methods to ensure more effectively their observance.

I should like to say here that I believe that the establishing of the Court of Auditors—due in no small measure to the work of the European Conservative Group within the European Parliament—will undoubtedly contribute to better control of the Community finances. But the draft Treaties now being considered are a first step towards enforcement of the Treaties, and the beginnings of a system of European criminal law.

Expressing, again, a personal view, it would have been more logical, and I believe ultimately more equitable, to grant jurisdiction to the European Court of Justice, rather than leave it to Member States to impose penalties for non-observance of Community rules in accordance with their own national laws. There will surely be great difficulty in similar offences being treated in a similar way. Directives give States latitude in the way they legislate to achieve a particular objective of Community policy, so that the sanctions to be imposed will vary from State to State.

The application of regulations will also vary, according to the traditional views of the Judiciary in any one Member State. Procedures vary enormously, so that for identical offences an accused may, for instance, be kept on remand for months in one Member State before coming to a court, or let out on bail in another Member State. Legal aid may or may not be available to the accused. If the proposed system is adopted, however, it is essential that closer cooperation between the judicial bodies of the Member States should be encouraged, and indeed made mandatory, so as to remove wherever possible too great a divergence in the application of the sanctions. Indeed, such comparisons in Member States' criminal law procedures may lead to the creation of new law within the Community system.

There is one point which I should like to raise in relation to the question asked by the noble Lord, Lord Davies of Leek. There is the question of the person who is not a national of a Member State who may choose—no doubt wisely—to remain outside the Community. In that case, unlike his fellow workers who are in the Community, there will be little likelihood of his being brought before a Luxembourg court at all, however great the offence he has committed. I suppose that in that case it will depend, to some extent, on how many bilateral extradition agreements Luxembourg has entered into with other States. But this remains an open question.

In this connection, the report draws attention in paragraph 11 to the differences in extradition law and this is a very important element in the elaboration of these protocols. As the noble and learned Lord has pointed out, in the Federal Republic of Germany it is contrary to the basic law for a German national to be extradited. The view of the Committee, that an accused should be tried either in the country where the crime was committed or where he happens to be, is very strongly argued and is, I believe, convincing. But the studies of the experts and the Forty-second Report point to the need to strengthen the European Extradition Convention and have greater convergence—I hesitate to use the rather unpopular word "harmonisation"—as to the principles and application of the law of extradition, certainly within the geographical region of Western Europe.

There is another question which I should like to put, and I am not sure whether it should be put to the noble Lord the Minister or to the noble and learned Lord. I tried to get into communication with both noble Lords before the debate, so I apologise for springing the question. It is in relation to paragraph 13, which has to do with where the control of a company lies. I wonder where an individual who commits an offence in France, and is, for example, an employee of a company registered in England, which in financial terms is controlled by a Swiss or American multinational, would be tried. I was not sure whether the word "control" in this sense was synonymous with the registration of a company. I should be grateful if at some stage, perhaps not tonight, I could have some reply.

My Lords, I think that I can answer that question now. Paragraph 13 is concerned only with cases where the company itself has committed the offence. The reference to the place of control is made, because it is an expression which is the basis and is well-known in the Continental States. It is also something which is quite well-known in this country, because, in deciding in wartime whether or not a company is an enemy, one sees where its central management is. This does not concern cases where an offence is committed by a servant or employee of a company; it is only when the company itself is charged with the offence.

My Lords, I am most grateful to the noble and learned Lord for that explanation. I should like to comment on the principle of territoriality, which the noble and learned Lord raised. I am sure he will agree that the statement made in the Lotus case is entirely relevant. In that case, the court stated that, though it is true that in all systems of law the territorial character of criminal law is fundamental, it is equally true that all, or nearly all, these systems extend their jurisdiction to offences committed outside the territory of the State which adopts them, and they do so in ways which vary from State to State. So that although there may be a principle, there are various occasions when territoriality is not the overriding consideration.

Turning now to the second draft Treaty, regarding the liability and protection of officials of the Community, there have been obvious lacunae in these aspects and the draft Treaty is certainly to be welcomed. Although there are staff regulations, and a code of conduct which is imposed on the officials with the ultimate sanction of dismissal, so far there has been no way of imposing penal sanctions on an individual for fraud, forgery or similar offences, or breach of the oath of secrecy when in the service of the Community as such. Since the provisions of the draft Treaty leave it to Member States to enforce their own measures, again there will be great divergence not only as to procedure but surely, in the case of official secrets, as to substance as well. There will be considerable differences between Member States as to their concept of what constitutes an offence within their own legal system and their own interpretation.

Since Community officials, including the Commissioners themselves, serve the Community as a whole and are international civil servants not specifically serving Member States, it seems anomalous that they should be subject to national laws. In real terms, it is unrealistic to expect a Member State to be prepared to prosecute a European Community official who had provided his State of origin with official information, contrary to the Official Secrets Act. Again, if I may give a personal view, I should prefer offences of this nature to come within the jurisdiction of the European Court of Justice at supranational level.

Whatever the minor demerits of the draft Treaties, the overall concept is surely to be welcomed. Having to compare the different methods of application of economic rules and criminal procedures within the Member States may lead to progress in these fields of law and greater co-operation among the judicial bodies of Member States.

There is one point that I should like to add. I believe very strongly that the timing of the introduction of these Protocols is of paramount importance. Attention should be drawn to the need to ratify these Protocols, or amended versions of them, within the near future. The many years it has taken legal experts within the Community to propose these draft Treaties in their present form will be again extended for further years if they are not ratified by the existing Member States—the Nine—before further enlargement of the Community. Therefore, in thanking the noble and learned Lord and his Committee may I say that I hope the Community takes note of the comments of the members of the Committee who produced the Forty-second Report and the introductory speech of the noble and learned Lord, and acts with all possible speed in achieving the ratification of these draft Treaties.

5.33 p.m.

My Lords, may I begin by thanking the noble and learned Lord, Lord Diplock, and, indeed, all the members of his Sub-Committee, for their thorough and interesting report. The House is undoubtedly indebted to the noble and learned Lord for the characteristically lucid way in which he introduced the report this afternoon. I shall begin by dealing with two points which have emerged during our brief debate and will then come to the substance of the argument of the noble and learned Lord.

If I may deal first with the point regarding the Official Secrets Act to which the noble Baroness, Lady Elles, has just alluded, Article 4 of the Protocol to the draft Treaty amending the Treaty and establishing a single Council and a single Commission requires us to apply to Community officials the provisions of our criminal law which relate to what is described as "breach of professional secrecy". This concept is not known to our law, and we must seek clarification of it during our further discussions in Brussels, However, the broad idea seems to be that we should apply to Community officials the law against the unauthorised disclosure of official information which applies to our own civil servants, and we hope that when the time comes to do this our own law will be in a great deal better shape than it is at the moment. The House will recall the recent announcement of our intention to publish a White Paper containing detailed proposals to repeal and replace Section 2 of the Official Secrets Act 1911.

The second point with which I should like to deal at this stage was raised by my noble friend Lord Davies of Leek, although it is not covered by the precise terms of the debate we are having this afternoon. It concerned the driving offence in this country committed by somebody who is not necessarily a national of an EEC country; he can be an American or a British citizen, resident, let us say for the sake of argument, in Kenya. I am well aware that there is a great deal of anxiety on this point, and I am constantly receiving letters from Members of another place about it. If an accident takes place in a local community—sometimes it may be a quite serious case involving careless or dangerous driving—injury may be caused. The problem is that if the person concerned is not a resident of this country and is about to leave, often there is nothing that the police can do. This creates a great deal of ill-will, in particular among those of our fellow citizens who are at the receiving end of a badly driven motor-car.

We are looking at this point to see what can be done. I am most anxious to deal with it because it is a matter which causes a great deal of public concern—and in my view absolutely justifiable public concern. Having said that, I must point out quite bluntly that there are a number of formidable problems, some of which have been touched upon during the debate we have had this afternoon, because of the different rules of evidence upon which we insist in our courts, compared with courts outside England and Wales. All I can say to my noble friend Lord Davies of Leek, is that we are well aware of this point and, speaking for both myself and my right honourable friend, we are very anxious to achieve a satisfactory settlement of a problem which is causing mounting concern.

Having dealt with those two points and before dealing with the detailed points which are raised in the report, it may be appropriate to say something generally about the origins of these proposals and the situation which we have now reached. Because they both relate to the criminal law, the Commission join together in the document which we are now discussing two entirely separate subjects. First, it was certainly recognised from the early days of the Community that specific provisions were needed to cover criminal offences which might be committed by or in relation to Community officials in the course of their work. For example, it was thought to be indefensible that certain acts by Commission officials in Brussels might not be caught by the criminal law, although it would be a serious criminal offence for the civil servant of a Member State to do precisely the same thing. Work to fill these gaps was virtually completed in 1972 when the Community was enlarged. The Commission then called together a working group of national officials, representing all of the Nine Member States of the Community, in order to make any appropriate adjustments.

Work on infringements of Community law began in 1971 upon the initiative of a conference of Ministers of Justice. They were concerned to improve the enforcement of the criminal law in the areas of taxation, customs affairs, agriculture and foodstuffs, particularly where co-operation between Member States was thought to be clearly desirable. We were involved in the official working group on that subject virtually from the beginning of its period of work.

Although we participated in working groups on both subjects, Member States, including the United Kingdom, are not naturally committed to supporting the Commission's proposals either in general or in particular. Our view is that a good deal of very careful work is needed on the proposals before we could be in a position to make a judgment about their merits, and I am sure, on the basis of what the noble and learned Lord, Lord Diplock, has said, that that indeed is his view. In due course, we expect that Council working groups will be established to study the Commission's text in some detail. I hope our officials will then be able to make a full contribution. In that context, it is helpful to the Government to have had the opportunity of having the report of the Select Committee and, indeed, the debate which we are having this evening.

Any proposals for greater international co-operation in the field of criminal law enforcement almost inevitably create particular difficulties so far as the United Kingdom is concerned. These derive from fundamental differences between our criminal justice system, with its common law tradition—our emphasis, as the noble and learned Lord, Lord Diplock, said on oral evidence, the opportunity for cross-examination and a territorial basis of jurisdiction—and the system generally to be found on the Continent of Europe. As the Select Committee's report implies, the benefits of greater international collaboration have to be balanced against the problems of fitting in with legal systems markedly different from our own. However, the Government accept that our membership of the Community makes it necessary to find a solution to these difficulties. We clearly have just as great an interest in, and responsibility for, the conduct of Commission officials as any other Member State. Therefore, the Government share the Select Committee's approach in acknowledging the problems that undoubtedly exist but seeking to work out how these can be overcome.

In turning now to detailed points that have been made on the draft Treaties, I must emphasise that my observations are without commitment as to the position that the Government will eventually adopt. However, it may be helpful to the House if I draw attention to some of the factors which we shall have to take into account. I shall deal first with the draft Treaty which is intended to ensure that the financial interests of the Communities are adequately protected by the criminal law and that infringements of Community law are prosecuted successfully. The Select Committee has recommended that its scope should be restricted to specific crimes of major importance to the Community. This is linked to the other proposal that all the offences covered by the draft Protocol to this Treaty should be made extraditable, so that the State where the offence was committed would always be able to choose between applying for extradition or asking another country to initiate proceedings.

The approach of the Ministers of Justice in 1971 was to identify the areas of Community law where action was particularly desirable. The difficulty lies in knowing how best to draw the line between major and minor offences. Indeed, the noble and learned Lord made that point. The Commission's approach is to cover everything and, thus, to leave it to prosecuting authorities to decide when a case is sufficiently serious to be pursued by extradition, or the transfer of proceedings. The potential difficulties for the United Kingdom in being involved in the transfer of proceedings in either direction mean that we could contemplate it only for a serious offence, and we would not want to seek, or grant, extradition for trifling offences. If we are to press for a limitation of scope, we need to consider whether this can best be done by listing specific offences as the Select Committee suggested, or by specifying subject areas as the Ministers of Justice thought six years ago, or by reference to the seriousness of the available penalty as is done in the case of extradition between States party to the Council of Europe Extradition Convention. There is no obvious solution.

We must also bear in mind that the Council of Europe Convention on the Transfer of Proceedings in Criminal Matters is not limited to serious offences. The Commission have understandably drawn on the Council of Europe's work in this field. Some other Member States of the Community have already ratified or signed the Council of Europe Convention, so that for them the Commission's proposals present little or no difficulty. It may be that we shall be faced with strong opposition to any proposal for a limitation on the offences to be covered from Member States with practical experience of the transfer of proceedings who know that discretion is used to avoid covering trivial cases.

We must recognise that, when countries have a similar legal system which is not based on the principle of oral evidence, they might contemplate the transfer of proceedings in a case which we would not think serious enough to justify the procedure. There are some important safeguards in the Protocol attached to the Treaty. For example, we are not required to seek to transfer proceedings under Article 2 or to bring proceedings under Article 5. One reason to be given under Article 5 for not bringing proceedings might well be that insufficient evidence is available, for example because witnesses who live in other countries cannot be compelled to come here to give evidence. It is widely recognised by our fellow Member States that some of the provisions in the Protocol are likely to work a great deal less smoothly in the United Kingdom and the Republic of Ireland than in some other Member States of the Community.

In pressing the case for more offences to be made extraditable and, by implication, for more use to be made of extradition, the Select Committee has drawn attention to an aspect of this problem which we think is particularly relevant. We believe extradition to be the best method of dealing with offenders who move from one country to another. There will always be difficulty in the case of countries which, unlike us, are not willing to extradite their own nationals, and of course, extradition is not available for offences committed by bodies corporate. In the past there have been objections to the use of extradition in the case of fiscal offences. But when the financial interests of both the country requesting extradition and the country being requested are directly damaged by an offence, as they must be in the case of a fraud against Community funds, to take one obvious example, the same principles are not at stake. The Government have worked and will continue to work for a wider use of extradition to combat serious offences against Community law.

I shall now turn to the other Treaty relating to offences committed by or in relation to Community officials. Here the Select Committee made one major point: that jurisdiction should not be founded in the Member State of which an accused person is a national if he is not present there and the offence was not committed there. However, there is a good case for providing for the officials to whom this Protocol will apply to be dealt with in courts and, if necessary, in prisons in their own countries in order that they both can understand the proceedings and also be near family and friends. Perhaps understandably, the Belgian Government also takes the view that it is wrong for primary jurisdiction to rest with the country where the offence was committed, because the location of the main Community offices would place virtually exclusive responsibility on Belgian courts and Belgian prisons. Having some personal knowledge of the problem in our own prison system, I do not find it difficult to comprehend the difficulties so far as the Belgian Government are concerned.

Despite that, we recognise that it makes much more sense in our case for jurisdiction to be based first and foremost in the country where the offence was committed. The evidence will normally be there. But again, there are certain safeguards in the Protocol. Under Article 6 if an offender is found in the Member State where the offence occurred, that State may insist on dealing with it. That seems to us to be vital. Secondly, a Member State is not in all cases bound to institute proceedings against one of its own nationals if he committed the offence elsewhere, even though he is found in its territory.

Under Article 6, the State where the conduct occurred may be asked, and may agree, to institute proceedings if this would be in the interests of justice.

In our case, there would sometimes only be any chance of a successful prosecution if the country where the offence was committed instituted proceedings, if necessary having first applied to us for the extradition of the alleged offender. In raising this matter the Select Committee have undoubtedly drawn attention to a feature of the Protocol which fits poorly with our own approach to criminal jurisdiction.

I turn finally to the provisions in the Protocols to both Treaties relating to the Court of Justice. The Select Committee has made two comments: that it seems unfair for persons in custody in cases caught by the Protocols to have the benefit of a time limit when others do not. And that reference to the European Court of Justice should normally be deferred until the appellate stage. These provisions seem to the Government to be among the more difficult of the Commission's proposals. No doubt when Article 177 of the EEC Treaty was drawn up, thought was not given to the problems that might ensue if there was a reference from a court of first instance in a criminal case particularly if the accused was in custody. No doubt it was thought, and thought indeed correctly, that most references would be made from civil courts. But here we have Protocols which are concerned exclusively with criminal cases. In suggesting a time-limit, the Commission were trying to come to grips with one aspect of the problem. But, apart from the question of equity to which the Select Committee drew attention, there is a question also of practicability. Past experience of references to the court suggests that it will be difficult, if not impossible, to reduce the time that is normally taken. The Committee also make a telling point about the impossibility of reconstituting a jury after an interval of more than perhaps even a few days. This area provides a particularly good illustration of how a great deal more work needs to be done on these draft Treaties before we could be in a position to make a final judgment about them.

In conclusion, I should like to repeat the appreciation of the Government of all the work that the Sub-Committee have done, and of the contributions which noble Lords have made in the course of this short debate. Work on this subject has already gone on for a considerable time, and I think it is clear that it is going to go on for quite a considerable period of time yet. In the months to come the searching analysis of your Lordships is bound to be of great benefit to those who negotiate on behalf of the United Kingdom.

5.53 p.m.

My Lords, I should like to thank the noble Baroness and the Minister for the kind reception that they have given to the report of the Select Committee, which was a very interesting report to write and to consider. It raises very serious problems to which it is not easy to see the solution. Of course, if you have cases tried in the various Member States it is inevitable that there will be differences in procedure, differences in punishment and indeed differences in the prisons to which they go. That is something inevitable; it happens now.

May I just—because this is a difficult problem—revert to the point raised by the noble Lord, Lord Davies of Leek, and also by the Minister. That is a problem which is with us. It is not a problem which comes within these Protocols at all, because these only deal with offences against Community law, and the kind of offence with which Lord Davies of Leek was dealing was an offence against the ordinary criminal law of motoring offences. It is a problem which is with us. It is a problem which grows as transport becomes more international, but it is a problem which has really got nothing to do with the Protocols.

On Question, Motion agreed to.