Before the Minister moves that the first statutory instrument be considered, I remind the Committee that in the case of each statutory instrument the Motion before the Committee will be that the Committee do consider the statutory instrument in question. I should perhaps make it clear that the Motion to approve the statutory instrument will be moved in the Chamber in the usual way.

rose to move, That the Grand Committee do report to the House that it has considered the Sex Discrimination (Amendment of Legislation) Regulations 2008.

The noble Baroness said: The draft regulations were laid before the House on 6 March, and I confirm that their provisions are compatible with the European Convention on Human Rights.

The United Kingdom has a long tradition of legislating to protect people from discrimination. We have had protection from sex discrimination in employment, education, the provision of goods, facilities, services and the management of premises in Britain since 1975 and in Northern Ireland since 1976. It is in this context that the Government welcome the fact that European law is catching up with long-standing principles that are enshrined in our domestic law by extending existing European protection in employment-related areas to non-employment areas.

We welcome the European Council gender directive, which is implemented by way of these regulations in Great Britain and Northern Ireland. It will ensure consistency in sex discrimination protection throughout the European Union. Our proposals for implementation have been the subject of public consultation both here and in Northern Ireland. In Britain, that was alongside the consultation on the proposed Equality Bill, from 12 June to 4 September; and the Northern Ireland Executive consultation followed from 30 July to 21 September, setting out proposals that mirrored closely those for Great Britain.

The regulations introduce some new protections and extend others in existing sex discrimination law in the fields of goods, facilities and services—I am tempted to say “GFS” from now on; it might shorten our debate by about 20 minutes—and premises. In short, these regulations are a welcome stepping stone to the further reform of discrimination law that is intended to take place through the Government’s proposed Equality Bill in Great Britain. At the same time, there are some differences between what is required by the gender directive and the existing UK protections.

The regulations are being made under the European Communities Act 1972. The small number of amendments to the Sex Discrimination Act 1975 and the Sex Discrimination (Northern Ireland) Order 1976 are required so that additional protection in line with the gender directive applies to both women and men in the provision to the public of goods, facilities and services—regardless of whether such goods, facilities and services are provided free or are charged for—and the disposal or management of premises.

The most significant proposals on which we consulted between June and September 2007 in Great Britain, and in Northern Ireland between July and September, were the following. The first was a specific prohibition on sex and sexual harassment in the provision of GFS. Our legislation currently provides protection from discrimination but not from harassment. The second proposal was protection from discrimination and harassment in relation to GFS and premises for people intending to undergo, or who are undergoing or who have undergone, gender reassignment. That would extend protection to an estimated 5,000 people who are at present excluded from protection in the field of GFS. The third would express protection from discrimination in the field of GFS and premises for women on the grounds of their pregnancy and maternity. We do not have that explicit protection in this area of our legislation, although in fact many cases are likely to be covered by existing sex discrimination law. Fourthly, the regulations would introduce greater transparency where insurers offer differential premium and benefit levels on the basis of gender. The fifth proposal is a shift in the burden of proof requirements.

So, we have here a welcome opportunity to improve our existing laws in advance of an Equality Bill in Britain. The timetable for amending our legislation is determined by the directive, which required member states to implement it by 21 December 2007. It is important therefore that we act at the earliest possible opportunity to bring ourselves in line with European law.

I am sure that Members of the Committee will have noticed that these important regulations, which replace those laid before the House on 28 November, amend legislation in Great Britain and Northern Ireland. Let me explain why we have done that. Northern Ireland Ministers have competence to legislate on discrimination matters, and the intention was for similar regulations to be introduced there to the same timetable. However, it became clear late in the process that the First Minister and the Deputy First Minister could not reach joint agreement on all the policy proposals to implement the gender directive. A failure by part of a member state to comply with the directive will be considered by the European Commission as a breach by the whole member state—here, the UK—and that clearly was not an option.

Although implementation is now already late, the Government considered that the most effective means of ensuring that the UK as a whole could comply with the directive was for regulations implementing the directive in Britain and Northern Ireland to be taken forward at Westminster. Northern Ireland Ministers have not objected to this course of action and we have had the support of Northern Ireland officials in drafting the regulations. Legislating in this way offers the most effective means of putting these additional protections in place in Great Britain and Northern Ireland as soon as possible after the deadline of 21 December 2007, which we are committed to doing.

I have spoken about the wide consultations on the changes. The Government presented the proposals for the draft regulations alongside the wider proposals for an Equality Bill for Great Britain in a single consultation package, so that stakeholders could see how the proposals fitted into the wider landscape of discrimination law reform. There was an equivalent consultation in Northern Ireland. We have noted and drawn on the consultations in drafting our final proposals.

These proposals are complex. I hope that Members of the Committee will forgive me if I go into a bit of detail as it is important to understand the range of changes. Protection against discrimination and harassment on grounds of gender reassignment is not new in UK law. We are simply extending the protection that already exists for employment. The Sex Discrimination Act and, in Northern Ireland, the sex discrimination order already provide protection from discrimination and harassment in employment and related areas for people who are planning to undergo, who are undergoing or who have already undergone gender reassignment. But we are clear that we need to extend protection on those grounds outside the workplace if we are fully to implement the directive.

The directive does not expressly confer protection in this field, but a joint European Council and Commission statement recognises the application of the principle of equal treatment in the directive to grounds of gender reassignment. The principle, that the right not to be subjected to direct discrimination on grounds of sex includes changing sex or gender reassignment, is not new. It was set by the European Court of Justice in a 1996 employment case. In interpreting the reach of the directive, we have taken our lead from the Council and Commission statement and from that 1996 judgment. In 1999, we introduced regulations outlawing discrimination on the grounds of gender reassignment in Britain and Northern Ireland in the field of employment.

We now have the opportunity to extend discrimination law protection on the grounds of gender reassignment to goods, facilities, services and premises. It might be helpful if I reaffirm what is not covered by these regulations in that respect, given that, in 2007, we had debates on related issues when we introduced the Equality Act (Sexual Orientation) Regulations 2007. These regulations make similar changes.

As I think Members of the Committee will agree, it is unnecessary for me to repeat what I said in the extensive debate we had on those issues a year ago except to make the following points. Religious worship and observance fall outside the scope of the directive, so these regulations do not in any way affect such activities; nor do they prevent people holding the belief that it is wrong to seek to undergo gender reassignment. But the regulations prohibit discrimination and harassment in areas covered by the directive, such as services normally provided on a commercial basis. For legal certainty, and in response to comments we received from the Equal Opportunities Commission during the consultation period, we have clarified that in new paragraph 9(c) of Schedules 1 and 2 to the regulations.

The regulations simply outlaw a person being denied access to a shop or being the subject of abuse by a sales person, for example, because they intend to undergo, are undergoing, or have undergone gender reassignment. As we argued in relation to the 2007 regulations, an exception for individual religious believers to be exempt from the regulations—for example, the Christian owner of a commercially-run bookshop or cafe—would effectively create an individual conscience clause that would introduce a test that is so subjective that it would render the regulations ineffective for the purposes of implementing the directive and would therefore be unenforceable.

Apart from the directives, Parliament has already made its views clear that it is quite wrong in the United Kingdom today for people to be discriminated against because of the prejudices of others. The regulations extend those rights to a very small group of people who are currently unprotected in these areas. We are right to act with Europe to increase protection for people on the ground of their gender reassignment.

The regulations achieve the right balance between protecting religious liberty and human rights under the law, ensuring that people are free to hold and observe their religious beliefs but not to manifest them in such a way that treats one group of people differently from others.

I turn to harassment. Protection from harassment in the UK originated in domestic case law and was put on a statutory footing following implementation of earlier European directives. In employment and related areas, in 2003, we expressly outlawed harassment on the grounds of disability, sexual orientation and religion or belief; and on the grounds of age in 2006. In the case of race, the relevant directive has a wider reach, so in 2003, we outlawed harassment not only in employment and related areas, but also in goods, facilities, services and premises. In 2005 we introduced protection against sex, sexual and gender reassignment harassment in employment and related areas. Now the regulations will make it unlawful for a provider of goods, facilities, services or premises to subject a person who seeks to obtain those goods or use those services, or who is supplied with them, to sexual harassment, sex harassment or harassment on the grounds of their gender reassignment.

There is, however, an additional change to which I want to draw attention. It was made following a judicial review brought by the former Equal Opportunities Commission. In March 2007, the court ruled that the definition of sex harassment in the Sex Discrimination Act 1975 should be recast to provide a slightly broader definition by reference to the relevant European directive, which itself provides a new definition of sex harassment. Put simply, that would, in the employment context, mean that where one person is telling a sexist joke to another person at work, and a nearby employee overhears and considers that this has violated their dignity or created a hostile or offensive environment for them, they could make a claim that they have been subject to harassment related to sex. Such a situation is not covered by the existing definition of sex harassment, so that is an important change.

Regulations giving effect to that ruling were laid before Parliament on 14 March and are to commence on 6 April 2008. Because the sex discrimination order in Northern Ireland broadly mirrors sex discrimination law in Britain, equivalent amendments are being made to it.

Although the judgment addressed specific situations in employment and related areas and is related to the implementation of the relevant European directive covering employment and related areas, the gender directive uses the same definition of sex harassment as the European employment directive. The regulations therefore apply the same new definition of sex harassment introduced on 6 April, which will give effect to the judicial review judgment, to the fields of goods, facilities, services and premises. We will therefore have consistency within the Act. I hope that that will meet the concerns of the Equality and Human Rights Commission which, I know, wanted to be clear how the new definition would apply outside the employment area. In essence, therefore, from the date that the regulations come into force, a person seeking to access goods, facilities, services and premises will also be protected from sex harassment based on the new broader definition. This in turn addresses the concerns of the JCSI, which brought the House’s attention to the draft 2007 regulations in this respect. I am pleased to be able to say that the most recent report from the JCSI did not draw the attention of the House to any issues with regard to the regulations.

I start by thanking the Minister for that very extensive speech. There are a lot of subjects wrapped up in the regulations, and I do not want to concentrate on most of the subjects on which she has enumerated this afternoon. When I hear a speech lasting 22 minutes from a Minister introducing regulations, I have a nasty suspicion that there is something to hide. I am going to absolve her of that today, but perhaps not in the future; we shall see.

We are discussing today an important review of the Sex Discrimination Act 1975 and the Sex Discrimination Act 1975 (Amendment) Regulations 2007, which were made on the back of the Act. It is a shame that this discussion did not take place when it was initially intended to in December, but the Government have shown only too frequently of late that they find sticking to timetables more than a little testing. So to begin discussion of this long awaited topic we will need to refresh our memories on what it is about. As the noble Baroness said, these amending regulations bring statute law into line with case law. They are also a response to the Equal Opportunities Commission’s ruling that the previous regulations amending the Act fell short of the 2004 European Community’s gender directive’s intention to ensure that women in the workplace are not subjected to,

“any unwanted conduct related to their sex which violates their dignity or creates an intimidating, hostile, degrading, humiliating or offensive environment”.

That is a very clear definition of harassment. This is to be illegal in future in the areas about which the noble Baroness spoke, and it is absolutely right that that should be the case.

The result is that instead of depending on individuals making complaints about sex discrimination, the duty places the legal responsibility on public authorities to demonstrate that they treat men and women fairly. The duty will affect policy making, public services such as transport, and employment practices such as recruitment and flexible working. These Benches stand in firm support of any directive or action that any Government can take to remove sexual prejudice or exploitation. We therefore support the implementation of the regulations and the intention that lies behind them.

Before I explain why I am not entirely satisfied with these new regulations I feel it necessary to make it clear for the record that I believe that much in them is good. Indeed, this was set out clearly and extensively in the noble Baroness’s long speech. They will realise some very sensible decisions. They do not blindly extend protection to an apparently vulnerable sex regardless of the circumstances. For example, it is correct, in paragraph 7.24, that women on flights and those partaking in certain “extreme” sports are excluded from sexual discrimination when heavily pregnant. But, a word of caution, there are bound to be arguments about the legal definition of “heavily”.

The regulations being discussed today have been much anticipated. The judicial review held in late February 2007 exposed the Government’s previous regulations made in 2005 to have been a failure. Lack of clarity in the drafting meant that women risked losing the full protection against pregnancy discrimination that they now have under UK case law. It also did not stipulate that pregnancy and maternity leave must be counted by employers as continuous service for the purposes of promotion. That sentence sounds a little odd—quite how pregnancy can be continuous service rather defies my imagination. The High Court ruled that the 2005 regulations not only failed to implement the 2004 gender directive but made life worse for pregnant women than the then law.

So, it is as clear as daylight that there is an immediate and obvious need for new regulations. But I have been disappointed to see how slowly the Government have responded to this need. Perhaps they do not find regulations particularly pressing or as thrilling as getting new legislation on to the statute book. If one looks around the Grand Committee, one sees that these regulations are receiving not nearly the attention they would have had if they been discussed in the Chamber. Whatever the case, as the Explanatory Notes explain in paragraph 7.9, the Government decided to consult on the gender directive as part of a wider consultation on proposals for an Equality Bill, as the noble Baroness mentioned. However, the original start of the consultation got pushed back from the planned start date of March. This was due to the need,

“to focus on getting the policy for an equality Bill right”.

That is all well and good in theory but these regulations are not one and the same as the Equality Bill. The noble Baroness explained that a little but it would be extremely helpful if she would expand on that in her response.

The Minister deserves our sympathy and gratitude for having to explain at great speed such an obscure and complicated subject. We will all need to read and think about her important speech hereafter because a great deal of what she said is of great importance not only to people in Parliament but well beyond.

The subject is very complicated. I find it particularly so because there are different directives and different regulations. I shall probably get this wrong, in which case I shall be corrected. There are the Sex Discrimination Act 1975 (Amendment) Regulations 2008, which implement Council Directive 113 and are concerned with implementing the principle of equal treatment between men and women in the access to and supply of goods and services available to the public. There is also another set of regulations, the Sex Discrimination (Amendment of Legislation) Regulations 2008, which are to come into force on the same day, 6 April. They implement another directive, which I will come to. As the Minister said, implementation should have been completed by 21 December 2007, but the process of implementation was delayed for various reasons, which I understand and sympathise with. The Minister has explained that there is a pressing need to implement the directive; we agree.

Directive 113 is clear that there should be no direct discrimination, including less favourable treatment for women by reason of pregnancy and maternity. The Minister has explained why the Government have chosen to limit protection to the first 26 weeks after birth. It is strongly arguable that that limit of 26 weeks is not consistent with the decisions of the European Court of Justice in Lewen against Denda and in Brandenburg against Sass, as applied by the High Court in judicial review proceedings in the EOC against the Secretary of State for Trade and Industry.

This is not the place to argue whether that is right or wrong, but there is no material difference between the wording of the equal treatment amendment directive 2002/73/EC, known as ETAD, and the directive here being implemented. In my view, it is strongly arguable that to comply with the directive, the period of protection ought to be extended. This is obviously a very important issue, which affects a large number of women and men.

During the Discrimination Law Review consultation, the EOC raised a number of important concerns, only some of which are being met in these and the other regulations. Others are outstanding. I have drawn those to the Minister's attention. Again, this is not the place in which to go into each and every one, but we are grateful for the Minister's assurance that there will be discussions as a matter of urgency, so that the matters raised by the commission and its successor, the Equality and Human Rights Commission, may be taken into account in developing policy on the proposed performing legislation and to secure full compliance with the UK's Community obligations.

Perhaps I may give an example—I will not give a whole series of them. Article 2(a) of the directive defines direct discrimination as occurring,

“where one person is treated less favourably on the ground of sex, than another is, has been or would have been treated in a comparable situation”.

It says “on grounds of sex”, not “on grounds of her sex”. But Section 2(1)(a) of the Sex Discrimination Act 1975, for which I suppose I am partially responsible as one of its architects more than 30 years ago, is narrower and applies only to the grounds of the complainants’ sex, rather than on grounds of sex. Incidentally, that is also narrower than the definition of direct racial discrimination in the Race Relations Act 1976, which refers to racial grounds but does not require the grounds to be the complainants’ ethnicity. That is one important problem about the concept of discrimination.

There is also a similar problem with gender reassignment, where Section 2A of the Sex Discrimination Act is narrower than the directive, both on direct and indirect discrimination. I perfectly understand the reasons for adopting the definition of harassment as it has been in the regulations, but may I strike a cautionary note? As the Minister may know, we in this House have again and again resisted the notion of religious harassment involving violating a person’s dignity on religious grounds for free speech reasons in debates that were similar to the debates that we had about religious hate speech, which were important. While I understand the very broad definition being given to harassment and the concept of gender, it should not be taken as a precedent on the basis that one size fits all and that one would do precisely the same in the area of religion, which gives rise to rather different issues.

On insurance, in response to the consultation, the EOC welcomed the proposal that the data on which insurance companies rely to calculate premiums are to be made available to the public. However, the commission explained in some detail, in answer to question 80 of the consultation, its view that the implementing regulations do not comply with the directive. The Minister has explained that the Government have worked closely with the insurance industry in developing the implementation proposals. I ask him for an assurance that the Government will also work closely with the commission to ensure full compliance with the directive by 22 December 2008.

My own view is that it is as unfair to discriminate for the purpose of insurance on the grounds of sex on the basis of actuarial data as it is on racial grounds. I have always believed that one should look at each person on the basis of his or her merits and not on the basis of their gender. Indeed, I think that women will now die as quickly as men if they lead the same appalling lives of stress and strain in this place or elsewhere, and so to generalise on the basis of the death rates of all women or all men is an invidious and unfair generalisation. Therefore, although the Government, on behalf of the insurance industry, have taken a more moderate line than that, I hope that in the long run actuarial premiums will no longer be calculated on the basis of gender-based statistics.

I remember the great American judge, Sandra Day O’Connor, in a leading case many years ago pointing out that some generalisations, even if true, should not be acted on—she was referring particularly to gender—so the mere fact that there are different death rates between men and women should not, if you aggregate all of them, lead to differential premiums. You should look at the individual person on the basis of their occupation, age and a number of other factors. In any case, we would like an assurance that the commission will be closely involved in those discussions.

On freedom of religion, I am delighted that no one here today seems to be taking up a different cause for fighting faiths. I entirely agree with the Minister that religious worship and observance fall outside the scope of the directive and are not affected by the regulations. The commission expressed concerns during the consultation, in paragraphs 79.2 to 79.14, about the compatibility with the directive of sweepingly broad religious exemptions, and I fully share those concerns.

The sprawling, tangled, impenetrable thickets of British anti-discrimination legislation are obscure and incomprehensible to everyone except a handful of specialist lawyers. Although I regard myself as a specialist lawyer, I, too, find some of it almost incomprehensible. The legislation contained in many inconsistent statutes and in hundreds, if not thousands, of regulations is in urgent need of comprehensive, user-friendly reform, so that everyone can enjoy access to justice. There is a pressing business need, as well as a need based on simple justice for victims, for the introduction at long last of a single equality Act that works in practice to eliminate discrimination based on sex and other grounds and to promote genuine equality of opportunity and treatment. My party will support the Government if they introduce legislative reforms that meet the high standards needed by employers, trade unions, service providers and vulnerable individuals and groups.

I am extremely grateful for the welcome given to these regulations and I entirely take the point made by the noble Lord, Lord Skelmersdale, that all parties are united in their determination to outlaw discrimination. We are very grateful for his party’s support on that. I always feel slightly intimidated in debates like this when I am confronted by two Members of the Committee with very wide experience, both of whom are forensic but who come from slightly different angles. It has been a useful debate and I apologise for speaking for a rather long time. I did that not because we have anything to hide but because it is extremely important, given the complexity and technicality of these regulations and the fact that they are part of an ongoing discourse, to put on record the implications as far as we could anticipate them.

I am glad that the noble Lord, Lord Skelmersdale, recognised the sense of urgency, but he also raised some important questions about the timetable. I cannot add a great deal to what I said about the timetable as it proceeded past the autumn, but because we were discussing with Northern Ireland, under the Memorandum of Understanding, how we could take these forward, given the complications that had arisen, it was necessary for some debate to be had, so there was another delay in the process.

As for the summer consultation, it became more complex and wider in general because we bundled consultation on this with consultation on the Equality Bill. Moreover, the machinery of government changes; new Ministers had come in, inevitably with slightly different perspectives and views on how to add what they wanted to the consultation. However, the consultation period was for the full 12 weeks. That is the good practice as set up with the Cabinet Office, and we observed it in this case.

The noble Lord’s other important questions were particularly practical and it is important to clarify them. He asked, for example, about the costs to business. These changes are relatively minor compared with the sorts of requirements imposed on business since 1975 not to discriminate on the grounds of sex. Those were the big changes, and these are relatively small. He is, however, quite right. This is the sort of issue where we continue to listen to business and discuss. We will be watching the implications of the change.

The noble Lord also raised the issue of tribunal capacity. These cases will go to the courts and not to tribunals. Protection under the 1975 Act has existed since 1975. We can draw some comfort from the fact that there have been very few such cases. We therefore do not anticipate a great number of additional cases arising from this. Because the transgender population is so small, I think it unlikely that it would place a great burden on the processes.

I am grateful for that. My particular question surrounded the expression “heavily pregnant” and when “heavy” becomes “intolerably heavy”.

I feel particularly qualified to answer that. We do not define “heavily pregnant” in the regulations, and it would be an act of absolute foolishness to try to do so. It was an example. If a service provider is aware that a woman is pregnant and that it raises a health and safety issue, they should take that into account. We were not trying to draw a legislative boundary based on the size of the bump of the lady in question. It is just an illustration. The qualification for health and safety reasons is very pragmatic and common sense. I appreciate what the noble Lord said about how the regulations were proportionate in that sense.

I am grateful to the noble Lord, Lord Lester, for giving me advance warning of the sorts of issues he wanted to raise. I addressed some of them in my remarks on the specific changes we made to the definition of “harassment”, for example, in relation to the judicial review. As the two sets of regulations have virtually identical titles, perhaps I may say again, for purposes of clarification, that the regulations that actually introduce these changes are the Sex Discrimination Act 1975 (Amendment) Regulations 2008, which amend the 1975 Act. The regulations that we are discussing today come into force at the same time. Both sets are governed by the Sex Discrimination Act 1975, so the change of definitions will apply equally to both. Of course, they have only slightly different titles, so it is a bit confusing.

On religious harassment—

I am grateful for that, but the problem is that we are considering only one of two sets of regulations. My points go beyond this debate, which is why we hope there will be close consultation with the Commission. Both sets of regulations will have to be compatible with both directives. That is what I am really on about.

Absolutely. As I was going to say, because we have been so aware of the EHRC’s concerns and because we are in a process which will culminate in a new Equality Act, we are absolutely intent on continuing the dialogue that we have had with the EHRC. We know that there are outstanding issues; the noble Lord referred to some of them. A meeting is fixed to take place in the next couple of weeks. As we go through this process it is important that we keep close to this in the way that we said we would when we talk for example about insurance provisions.

We certainly anticipate and will observe the reaction of the industry, and we will certainly work closely with the EHRC on this. As I say, we have dealt with what we could in these regulations. We have been concerned about timing, infraction procedures and so on, for the reasons that noble Lords understand. This is absolutely an ongoing dialogue. We did not want to get into any more trouble through delay and so on. The EHRC, along with other lobby groups, obviously has a very important role in assessing the reconciliation of regulations and where we go from here, and we really do want to continue the dialogue. The regulations are a stepping stone to the broad sunlit uplands that we aim to reach in due course. It is very useful that we have that to look forward to and that we can take that dialogue forward.

The noble Lord made a couple of other points. This House has made clear its views on religious harassment on more than one occasion. We consulted on the case for explicit statutory protection on the ground of religion as part of discrimination law, and we will set out our position when we consult on the whole thing.

I think that I have addressed most of the issues that the noble Lord raised. I am grateful again for the way in which the Committee has responded to the regulations. I appreciate that the regulations have not been the easiest set to follow in some respects—indeed, they have a long and complex history—but I am grateful for the support that they have received and commend them to the Committee.

On Question, Motion agreed to.

rose to move, That the Grand Committee do report to the House that it has considered the Legislative Reform (Health and Safety Executive) Order 2008.

The noble Lord said: The draft Legislative Reform (Health and Safety Executive) Order 2008 was laid before the House by the Department for Work and Pensions on 18 February. The order amends the Health and Safety at Work etc. Act 1974 to consolidate the Health and Safety Commission and Health and Safety Executive into one statutory body.

The proposal to create a unitary body originated from the Health and Safety Commission and the current Health and Safety Executive themselves, and has the agreement of the Department for Work and Pensions. It aims to merge the two current statutory health and safety bodies into a unified governing body to improve clarity in promoting the cause of better health and safety at work. Further aims are to improve communication, accountability and strategic oversight, and to provide a better challenge function to management.

The Grand Committee will be extremely grateful to the Minister for introducing this non-contentious order in his usual careful way. It is, as he said, laid under the Legislative and Regulatory Reform Act 2006, which we on this side of the Committee believe is not used nearly enough. Plenty of other subjects should have the attention of the Government, because regulations were laid down many years ago and today give the distinct impression of being overkill.

Today's debate is a classic example because an awful lot of water has flowed under the bridge since 1974, when the Health and Safety at Work etc. Act was introduced. That it was necessary in the first place is evidenced by the reduction in accidents at work since then, due partially to the efforts of employers and employees, but mostly, I believe, by the attention to detail of the members and staff of the executive. It was a great treat the other evening to meet the new chief executive of the new body.

Some of that water has been the evolution of corporate governance. I do not believe that, if we were enacting the Health and Safety at Work etc. Act today, we would dream of setting up two non-departmental public bodies to do the job of imposing what the Explanatory Memorandum calls,

“particular duties in specific circumstances and sectors, and also health and safety regulations made under the Act”.

The commission, which this order abolishes, was established as the principal body in the regulation of health and safety at work in Great Britain. The executive, on the other hand, was what the Minister has just called the operative arm which, along with its staff, advises and assists the commission in its functions and has specific responsibility, along with the environmental health officers, for enforcement and prosecution. It is notable, however, that the commission has never had the authority to direct the executive in the execution of its duty. The two non-departmental public bodies thus operated at arm’s length. There is absolutely no reason in this day and age why a single body should not do both jobs.

When this proposal hit the floor, it did so running. I note that during the consultation period there were only questions of detail on the composition of the new body. The main areas of concern were the number of members on the board, whether it should consist entirely of non-executive members, and who should be consulted before their appointment.

I observe that the Government have stuck to their original intentions with one notable exception—they have decided to increase their originally proposed board from a chairman and nine members to a chairman and 11 members. The Minister well knows my views about numbers of board members because we had a discussion the other day about the size of the Child Maintenance and Enforcement Commission, when I said that such boards should be as small as possible, so I hope that a chairman and 11 members fulfil that criterion. Time will tell, but I must ask the Minister whether there is provision in this order or in the Health and Safety at Work Act to increase, or I hope to decrease, the size of the board.

It is my hope too that the revamped executive will be able to do something about the appalling state this nation has got itself into regarding protection of the individual, which has gone way over the top. This is a subject dear to my heart, as I said in a debate responded to by the Minister’s predecessor, the noble Lord, Lord Hunt of Kings Heath. For schools to stop small boys playing conkers, which is after all a traditional playground activity, or to prevent children climbing trees, will do nothing to make them responsible and careful adults. It is an absolute disgrace that one school cancelled its annual Guy Fawkes bonfire party last year because children might get too close to the bonfire and become scorched, or at worst burnt. Although I accept that teachers have a duty of care, I cannot accept that if a child is told not to do something and then goes ahead and does it, it is necessarily the teacher’s fault, or that if an employer holds a health and safety meeting of his staff and one of them ignores it, it is automatically the employer's fault.

The trouble is that over the last 30 years a compensation culture has grown up in this country which was never intended by Governments of either complexion. I can illustrate this by relating a story about my wife, who broke her leg while on holiday in Sri Lanka by slipping down some steps and falling awkwardly. On her return, to her horror, the first friend who came to see her asked almost immediately whom she was going to sue. Her answer was, of course, no one, as the accident was caused through her own admitted carelessness.

It is my belief that the “no win, no fee” agreements have got completely out of hand, and that the courts have been unduly lenient. It is one thing if someone damages their back by slipping on a wet floor at work when there is no warning notice—the subject of a television commercial that is doing the rounds—but quite another if an accident happens due to pure carelessness. The fact that a tree happens to be in a playground and a climbing child falls and breaks an arm, a leg or a collarbone is not to my mind an immediate reason to sue the school.

I discovered another version of trying it on when I had the honour to be a junior Minister in the Northern Ireland Office and there was a spate of people claiming to have ankle injuries because of uneven flagstones in Belfast. We conducted a little survey and discovered that some people claimed to have tripped over paving slabs several times—the same paving slabs that had been relevelled—a few weeks apart. They were the same people! The Secretary of State soon put a stop to that scam. It is the duty of us all to find a way that enables the genuine cases to get compensation while ensuring that those who made the main contribution to the accident get nothing. The “no win, no fee” legislation will then work as intended, which is a scenario much to be desired.

That said, I believe that the Health and Safety Executive has done a good job over the years, notwithstanding that it is often blamed for things that are nothing to do with its operations. The legislation handed down to it by the commission, and its visits to warn firms and establishments of dangers that might be impending, have proved the right approach, so I have no doubt that the new executive will be able to continue these operations and do its bit to make Britain a still safer place in which to work.

We on these Benches have nothing other than praise for the order, for the simple reason that it cuts red tape. Whenever this is accomplished, the Government should give themselves a small pat on the back, to be perfectly honest. Surely turning two bodies into one is a step forward. As for the attack by the noble Lord, Lord Skelmersdale, on the compensation culture, I agree, but with the caveat that everyone is always against excessive health and safety legislation until it is their child who is at risk. A new challenge for this body will be to try to get some reality about this. I have spoken before about reminding people that children heal when they fall over and cut knees and that this is quite normal and healthy, but that is rather different from allowing a climbing frame with a rusting and jagged piece on the edge of it to be in a playground. The concept of reasonableness is surely what stands behind all this, and a single body will surely have just a little more chance of ensuring that this measure gets through. I support the order.

I declare my interest as the vice-chairman of the Royal Society for the Prevention of Accidents and as president of the National Health Safety Groups Council and the London Health Safety Groups Council. I met Judith Hackett, who is the chair of the Health and Safety Commission, and the president and the vice-president of the Health and Safety Executive, who all asked me to thank the Government for the order, which I believe is the handiwork of Bill Callaghan, the previous chair of the commission.

The order is the second to have been made on the subject; the first was found to be defective by the councils and the chairmen. Anyway, we at last have it. It will not have been enacted before the Easter Recess, but it is on its way, and we congratulate the Government on it.

I am grateful for the support that the order has received from the three noble Lords who have spoken. The noble Lord, Lord Skelmersdale, talked about the progress that we have made since 1974 on health and safety, and about the important role that the commission and the Health and Safety Executive have played in that. That is absolutely right. There are still challenges out there that change as the nature of the workforce changes, which is why the improved governance arrangements provided for in the order are so important.

The noble Lord also referred to enforcement and the importance of ensuring that enforcement action was independent and could not be fettered either by Ministers, by the commission or by the new board of the executive, as it will be. That is an absolutely clear principle, which has been maintained throughout this process. He referred to the number of proposed members on the board. At the moment, the order is essentially permissive; it allows for there to be between seven and 11 members—there are currently nine members plus the chair—and there are no plans at the moment to increase its size. The debate on what the appropriate size should be focused in particular on the need to ensure that there is scope for the range of skills that are needed on the board to bring full weight to bear on the issues that need to be addressed. He also talked about the protection of individuals and, in his terms, some of the nonsense that goes on. We always need to be careful in these situations not to perpetuate myths. Undoubtedly, in some instances, there are those with responsibility for enforcing health and safety who go over the top; and there are instances in which people use health and safety as a reason for not doing something that they would otherwise want to do. When investigated, however, many of the myths of conkers and of benches being three inches too high or too low are simply not true. The key to all this is to recognise that the people who create the risks have responsibility for managing them. This is not about eliminating risk but about managing it.

The noble Lord referred to the compensation culture driving some of these issues. We need to think very carefully about this and to recognise that some people have been damaged at work by diseases with a long latency period and have struggled to get compensation 20, 30 or 40 years after the incident that has damaged their health, sometimes fatally.

The Minister is being unusually unkind in that explanation. I was talking about those accidents that are currently successfully sue-able—in other words compensable—and which were almost entirely the fault of the individual whom the accident befell. Clearly, I am not talking about something where the responsibility is 90 per cent or more on the employer or former employer; if he is talking about pneumoconiosis, for example.

I take that point, but I recall a debate in your Lordships’ House a couple of years ago when one of the committees of the House looked at whether we have a compensation culture. I think that the conclusion was to the contrary. In a sense, this debate is outwith the order, and we can perhaps return to it at some future stage.

I am grateful to the noble Lord, Lord Addington, for his support and for that of his party. I am grateful to the noble Lord, Lord Brougham and Vaux, who has a strong commitment to health and safety and is very active and engaged in the health and safety stakeholder community. He was right to remind us that this provision was in large measure the handiwork of Sir Bill Callaghan, the retired chair of the commission, and it has been taken up enthusiastically by his successor. I am grateful for the support that we received, and I commend the order.

On Question, Motion agreed to.

rose to move, That the Grand Committee do report to the House that it has considered the Official Statistics Order 2008.

The noble Lord said: The order is part of a wider programme of work implementing the Statistics and Registration Service Act, which gained Royal Assent last summer after a thorough and helpful scrutiny process in this House. Before explaining what the order does in detail, I should remind the committee about that Act and the wider statistical reform programme.

In line with the wider government agenda of delegating ministerial power to credible, independent institutions with a clear remit set by the Government and Parliament, the primary goal of the reforms is to reinforce the independence, integrity and quality of the statistics produced in government, helping to improve evidence-based policy-making, contributing to better public services and long-term stability in the UK economy and for the wider public good.

At the heart of the Statistics and Registration Service Act is the creation of a new independent body, the UK Statistics Authority, which is known in the Act as the Statistics Board, with a statutory responsibility to promote and safeguard the production and publication of UK official statistics that serve the public good. The authority will begin its work fully on 1 April 2008. Two of the Statistics Authority’s main functions are to monitor and report on all official statistics, wherever they are produced, and independently to assess the quality of a core set of key official statistics for formal approval as “national statistics”.

The order relates to the definition of official statistics; the set of statistics that the authority must monitor and report on. Under the Act, all statistics produced by the Statistics Authority, government departments, the devolved Administrations and other Crown bodies are automatically deemed to be official statistics. This means that numerous bodies are automatically under the oversight of the Statistics Authority.

However, the Act also allows us to add further statistics by order. This is necessary for bodies that are clearly producers of important statistics but which fall outside the core definition in the Act. That may include, for example, NHS bodies such as the Health and Social Care Information Centre, which produces statistics on, for example, the number of people in the country who are obese.

The order that we are proposing today is particularly pressing for those bodies that produce national statistics in the current system, such as the Health and Social Care Information Centre and the Higher Education Statistics Agency. Under the Act, statistics must be official statistics before they can be national statistics. To allow current producers of statistics to continue to produce national statistics at the start of the new system, these statistics must therefore first be specified as official statistics by order. If we do not make this order, these key statistics will no longer have “national statistic” status. These statistics will of course need to pass an assessment by the authority to continue as national statistics in the longer term, but we are taking about the immediate future.

Not all of the bodies on the list are national statistics producers. We are taking this opportunity to add a number of other bodies as official statistics producers. This may not be a complete list of all future official statistics, however. We want to work further inside government, and with the new Statistics Authority as it establishes itself, in order to ensure that the boundary of the official statistics system is set in the appropriate place. After that work has been done, it is likely—I know that this prospect will be greeted with great enthusiasm by the Committee—that we will bring another order before the Committee to add further bodies to the list in due course.

We have, of course, consulted the new Statistics Authority on the order, as required under the Act. The authority was keen to be sure that all current national statistics could continue to be national statistics under the new system, and that we had processes in place to ensure that the eventual scope of official statistics would be as comprehensive as possible. I am glad to say that we have been able to reassure the new authority on both points.

In summary, then, the order needs to be made now to ensure that a core set of crucial statistics can continue to be branded as national statistics come the start of the new system. I hope that the Committee will agree that this is necessary and appropriate, and can support the order, which is a necessary part of implementing the vital reforms to the statistical system that the Government have put forward to improve the quality and integrity of statistics for the public good. I beg to move.

Moved, That the Grand Committee do report to the House that it has considered the Official Statistics Order 2008. 12th Report from the Joint Committee on Statutory Instruments.—(Lord Davies of Oldham.)

I thank the Minister for explaining the order. We on this side of the Committee supported the Statistics and Registration Service Act 2007, the strengthening of which we are proud to have contributed to as it passed through both Houses. For all of us, as the Minister said, the integrity of statistics is important. We welcome the Statistics Board, and look forward to its work guarding against the spin which has so undermined public trust in statistics.

There was a useful final report from the Statistics Commission last week on first releases, from which it was clear that, of the 37 sets of statistics released in 2007 that it chose to review, judged under six different sets of parameters, 20 per cent got a red traffic light, 57 per cent scored an amber, and only 23 per cent got a green light. That is some indictment, and shows the magnitude of the task ahead of the Statistics Board.

There also remains an issue concerning the distinction between national and official statistics. We who are closely involved might understand the difference, but a layman, I suggest, will have considerable difficulty understanding it and, importantly, the different level of scrutiny applied to each. There is the important matter of the lack of independence in the selection of statistics referred to the Statistics Board. It is apparently for Ministers to refer a particular series of statistics to the board to consider whether such figures should be national statistics. Surely it ought to be for the Statistics Board rather than Ministers to decide what statistics should be defined as national statistics. Only national statistics will have to comply with the code of practice.

I am grateful to the Minister for carefully setting out the background to the order. It reminds me of the heady days of last year when we considered the Bill. The Minister gave a masterful exposition of the difference between official and national statistics, which reminded me why we sought to abolish this difference.

Given that one of the arguments for the order is, as I understand it, that by making the statistics produced by these bodies official statistics they can in some cases become national statistics in due course, the relevant list is very curious because it contains both significant and relatively insignificant bodies. I can, for example, imagine why the statistics produced by the Audit Commission for Local Authorities and by the National Health Service in England and Wales might become national statistics and be of considerable concern. However, I find it very difficult to understand why the Hearing Aid Council would produce statistics of equal significance. I think that the reason for this lies in the somewhat tortured and artificial distinction between official and national statistics which the noble Lord, Lord De Mauley, pointed out.

I have three questions about the order. First, it concerns England and Wales. What will happen in Scotland? Is there a process that the new Statistics Board will follow to ensure that when bodies in England and Wales are included in the framework an equivalent process takes place in Scotland so that the Hearing Aid Council for Scotland, for example, can be brought within the purview of the legislation?

My second question relates to the revenue implications of the order and more generally the current position in respect of resources available to the Statistics Board. When considering the Bill we spent a lot of time discussing whether the new Statistics Board would have an adequate number of highly qualified statisticians to do its work, particularly bearing in mind the move to Newport. Considerable fears were expressed in this House and by members of the statistics community that the new board would in effect be hobbled because it would not have enough highly qualified statisticians to do its work properly. As the order adds bodies that will be scrutinised by the Statistics Board, the question of resources is obviously highly relevant.

My third question relates to other orders that will come forward under the Bill. This is the first such order and must be about the least significant one that we are likely to see. Significant issues are still to emerge, not least of which is the question of pre-release activity on which the Government sensibly engaged in consultation that is now completed. However, if it is important that these bodies should be legally within the framework of the Statistics Board on day one, it is also important that the Statistics Board should have a legal framework on day one within which to operate in respect of pre-release. Can the Minister tell us when the order relating to pre-release will come forward?

We have no problems with the substance of the order, but it gives rise to a number of underlying issues that still cause us concern.

I promise not to delay the patient Minister for long. Like other noble Lords, I welcome the creation of the new board under the chairmanship of Sir Michael Scholar. As the Minister set out—I use his words—among its many duties from 1 April will be its responsibility to assess the quality and integrity of all key statistics in an independent manner.

As the Minister has stressed today, I realise that this is the first order that will be brought before us and that it is a first shot. Further orders will be laid and schedules listing other organisations will be before us before long.

I do not wish to diminish the importance of the organisations on this list—from the Hearing Aid Council to the Royal Navy Submarine Museum. They are all extremely important. The reason for my short intervention is to ask the Minister to explain whether any consideration has been given so far to the inclusion of the Bank of England—the key organisation that will make the new body more effective and which should be included on a subsequent schedule. If the Bank of England is omitted from its work, the new body will have far less credibility in future than we all hope it will possess. If the Minister has not considered the inclusion of the Bank of England on this schedule, would he elaborate on whether he expects this to change when he lays the next order? What consideration might he and his colleagues give to the inclusion of the Bank of England?

As the Minister has explained, and other Members of the Committee have observed, the Government retain the right to determine the scope of national statistics and the organisations that can be placed on this and subsequent schedules. I shall not delay the Committee in underlining why the Bank of England should be included in future. It is clear that the credibility of the new body will depend on the Bank of England appearing on a future schedule. I very much hope that the Minister will be able to explain, if not today perhaps in writing as soon as possible, what consideration has been given to that organisation.

I am grateful to the three Members of the Committee who contributed to this debate. I appreciate their questions and their assertion that we are all concerned about the integrity and validity of statistics, and their recognition that the Act passed last year makes significant movement in that direction. I am also grateful that the Committee has welcomed this order. I appreciate their criticisms, some of which I shall attempt to explain in the form of constructive action that the Government will take to meet the anxieties that have been expressed. However, in one or two cases I shall have to disappoint noble Lords opposite.

The noble Lord, Lord De Mauley, returned to one of the fundamental and most significant issues that we debated last year, which he will have known having read our proceedings; namely, who should select the statistics? The noble Lord says that he still finds the position adopted by the Government unsatisfactory and that this should be done by the authority. We had a very intensive debate on this issue last year. The Government’s view was that Ministers should do the initial selection regarding the work of their departments but, the authority—as it now is, but the board as we discussed it then—will have a fundamental role in evaluating and commenting on such statistics. The essence of the board’s role is assessment and scrutiny of the quality of official statistics, which is why it has been brought into existence to fulfil that most important of roles.

rose to move, That the Grand Committee do report to the House that it has considered the Town and Country Planning (Fees for Applications and Deemed Applications) (Amendment) (England) Regulations 2008.

The noble Lord said: I apologise to the Committee in advance for any errors that I make; I am rather full of cold, so you will have to bear with me, but I will try to be as clear as I can about this important order.

The regulations were laid before the House on 5 March. They introduce new levels of planning application fees and one new fee. If approved by this House and in another place, the regulations would come into effect on 6 April, the next common commencement date.

The principle underlying the planning fee regime is that would-be developers, rather than the council tax payer, should meet the bulk of the costs incurred by local planning authorities. A local planning authority’s work in this area includes the validation and registration of applications, followed by statutory notification, consultation and publicity, so that interested parties can comment. It involves maintaining an electronic and a paper version of the planning register and incorporating any revisions to the plans. It also includes writing to applicants and objectors, undertaking site visits, assessing the merits of each case and considering any representations about it.

The Government’s policy is that, in aggregate across England, the income generated by planning application fees should, as far as possible, cover the estimated total costs incurred by local planning authorities as a result of those activities. The last fee increase was in 2005, based on evidence gathered in 2003. In 2006, the Department for Communities and Local Government commissioned independent research to look afresh at the extent to which costs incurred by local authorities are recovered from fees paid by applicants.

The research, published on the Department for Communities and Local Government’s website, included a survey of local planning authorities and their resources. Arup’s report suggests that the total cost of the development control service is approximately £290 million to £365 million per annum, but fee income for 2005-06 was only £232 million. It concluded that, in aggregate, fee income has dropped below what is required to meet costs; whereas an overall increase of around 25 per cent would enable authorities not only to meet those costs but to maintain their standards of performance.

However, the Government would prefer to shield householder applicants from the full increase. Their fees are to go up by 11 per cent—that is, an extra £15. Other basic fees will go up by 25 per cent. The effect of this overall is a 23 per cent increase in planning fees—a figure at the lower end of what local authorities felt would be necessary for them to maintain a good and efficient service.

We believe that a greater increase would be right for the maximum fee which the regulations impose in some fee categories. Last year, in our consultation, we were proposing to abolish these maxima altogether, an idea that many local authorities supported. However, following representations and on reflection, an increase is now proposed. For most types of development where a fee cap is currently imposed, the maximum would be raised to £250,000, or £125,000 if the application is for outline permission. By contrast, the maximum fee for certain minerals and waste applications would go up only to £65,000. I acknowledge the point made by the CBI, the Quarry Products Association and other consultees that financial returns in relation particularly to mineral extraction sites tend to be disproportionately low. Only a small minority of projects trigger payment on that scale, but it is precisely those large and complex proposals that local councils find most difficult to assess and determine promptly with existing resources. For some large-scale major applications the separate arrangements for funding planning performance agreements will help, but for every other type of scheme, no matter how demanding of resources, the administrative cost ought to be met from planning fee income.

I remind the Committee that four out of five authorities in England are now achieving the planning application handling targets we set for them in the context of best value indicators and the planning delivery grant regime. We have also seen efficiencies in the delivery of local authority services where authorities have been required to deliver their overall responsibilities efficiently. Indeed, they have a good track record in achieving efficiency savings; not only have they exceeded their SR04 target one year early but they have forecast achievement of further efficiencies by the end of 2007-08 that would be in excess of the SR04 target.

The Merits Committee of the House has expressed concerns about where the incentive lies for an authority to control costs. In addition to the overall efficiency savings I have outlined, there is a real incentive for local planning authorities to determine planning applications efficiently and effectively because, where the cost of handling a planning application exceeds the fee payable, any shortfall must be covered from other council revenue or through subsidy from council tax, both of which are hard pressed.

We propose to introduce one new fee, which is for a request to the local planning authority for confirmation of compliance with one or more conditions imposed on a planning permission. That is designed to give developers greater confidence, especially where they wish to proceed to the next stage of a phased development or to sell the land on. The fee would be £85, or £25 if in connection with householder development. The only fee not to change will be that imposed in 2006 for monitoring mining and landfill sites.

The increases set out in the draft regulations before the Committee will keep planning application fees at a modest level for developers, compared to overall project costs, while enabling local councils to recover a fair proportion of their administrative costs from those who benefit most from the service provided and from any permission given. Research suggests that, if we did not secure increases at the level proposed, the deficit for local planning authorities would be in the region of £65 million in 2008-09. For those reasons, I commend the regulations to the Committee. I beg to move.

Moved, That the Grand Committee do report to the House that it has considered the Town and Country Planning (Fees for Applications and Deemed Applications) (Amendment) (England) Regulations 2008. 12th Report from the Joint Committee on Statutory Instruments.—(Lord Bassam of Brighton.)

Listening to the Minister reminds me of what a vexed local question planning invariably is. There is no getting away from that. Equally, there is no getting away from the vexed problem that all local authorities have when dealing with their budgets in total, of which, for planning authorities, planning runs away with a considerable amount of cost. No one can object to the principle that the cost of planning ought largely to be borne by those who are undertaking development. It was good to hear that what you might call the household proposals are to be protected by a lower increase in fee. Having said that, a better way to protect them would be to take the very small applications out of the playing field altogether, and I know that in various places there are some moves in that direction. Apart from that, the proposals are not wholly unreasonable in the circumstances. I have no reason to oppose them, and the Minister can go away happy that this is a part of an updating of the financial situation that we do not have any difficulty with.

We on this side of the Committee are quite happy with what is proposed. However, there seems to be something of a dilemma for the Government and local authorities in that, in seeking to protect householders while keeping business happy, local authorities will not be able to raise the income that they would like to have done. I think that the Minister would accept that this may be problematic for local authorities which, as he has pointed out, have done extremely well in creating efficiencies. There probably is not much further that they can do, although one hopes that they continue to try.

There is also a problem with cutting the service down too far. The capacity for development control officers to maximise things like Section 106, and whatever follows from it, requires investment in officer time. It might be a false economy overall to reduce by too much the capacity for local authorities to raise money. So, it is a difficult juggling act and I accept that. The Government have probably got it about right here, but I ask the Minister how they intend to monitor this in future, to ensure that local authorities are not too disadvantaged.

The maxima are in some cases still quite low; I do not know whether the Minister can say a word or two about that. Very large planning applications are hugely costly and go on a long time. One is ongoing in my area which we would have hoped to have had resolved well over a year ago. In fact, I have had another letter from the noble Baroness about the ongoing appeal. Costs are being racked up here all the time. I would not think that £250,000 would begin to cover the local authority’s costs on that one.

Finally, what has happened to Michael Lyons’s proposal that local authorities ought to be able to set their own local planning fees according to local circumstance?

I am grateful to the noble Lord, Dixon-Smith, and the noble Baroness, Lady Scott, for their support for our increased fees. It is perhaps worth saying that the increases have also been supported by the Local Government Association.

The noble Baroness asked what we would do to monitor the implementation of the fees. Following the approval of the fees, the Department of Communities and Local Government has undertaken to review the impact in 12 months’ time and hold further discussions with the Local Government Association and other stakeholder groups about how best to fund the planning system in future.

We also recognise that the planning fees regulations need consolidation. While that is something that we have not been able to contemplate during the recent spate of planning reform activity, we will obviously look to it in future. Because the increases are across the board, they do not impact more heavily on particular sectors of business or the community. The mechanisms for calculating fees are not being altered. As I explained, there is only one entirely new fee; that, too, was welcomed.

The noble Baroness, Lady Scott, made a valid point about the size of applications and the relative impact in terms of cost burden on the local authority. Obviously, any scheme for raising fees and charges has some imbalances in it. We think that we have got the balance about right here. The noble Baroness also asked whether we had thought about fees being set locally. We consulted on that point, because there has been an expression of interest in the past. However, I am afraid that it has not attracted widespread support from planning authorities. Of course, fashions and habits change and it is something we would keep an open mind about for the future. In April, we will publish a new explanatory fees circular, which will set out how fees work. As I have said, we will informally review the impact next year. Obviously, we will seek to identify with the LGA and others areas of communal ground on how to ensure that we more than adequately continue to resource planning services in the future.

I do not think that I need to cover anything else. I am grateful to both noble Lords for their support. In conclusion, it perhaps should be noted that the impact of the fees increases will not add significantly to the cost of development for developers. The typical planning application for a major development accounts for something like 0.3 per cent of the total cost of development, so it is a very small amount. But it has to be calibrated at the right level to ensure that we properly collect income into the local authorities.

I hope that the noble Lord will appreciate that 3 per cent plus 3 per cent plus 3 per cent plus 3 per cent, which is the way the system tends to work, soon becomes a large sum. Although of itself this may be small, a whole lot of other things are going on and development costs are inflating at above the average rate.

I did not say 3 per cent. I said 0.3 per cent, so the figure is less than one-third of a per cent. I take the point made by the noble Lord, but in reviewing the fees structure and the overall inflation in development costs, we do not think that we have added significantly to the burden on development. It would not be our wish to do so. However, we want to encourage adequate, full-cost recovery. As I have explained, it is likely that these increases will net nationally some £65 million to bridge that gap which the research by Arup identified.

On Question, Motion agreed to.

rose to move, That the Grand Committee do report to the House that it has considered the Bedfordshire (Structural Changes) Order 2008.

The noble Baroness said: We are debating the order which brings into effect the two unitary authorities for Bedfordshire.  This is the last of the orders implementing restructuring proposals from this round that will be brought to this House for the immediate future. I feel that this is something of a solemn moment after the heat and burden of the day. I am sure that Members of the Committee are as sorry as I am to see the end of the passage of this order. The reason why this order is the last of those that have been presented to this House is because the process in Bedfordshire has been more complex than that in the other areas.

I do not want to reiterate much of what I have said on the previous orders, because we have been over it quite a few times. I also lack any cavalry behind me, but I am sure that they will be along in a moment. However, I need to outline the process because in Bedfordshire the situation was different. Members of the Committee will know that the process began in October 2006 with the local government White Paper, and we indicated that there was dissatisfaction with the confusion and weakness in two-tier working. Knowing Bedfordshire as I have come to know it in the past few years, I have to say that local governance in Bedfordshire could be viewed as an example of this confusion. It has not been a happy situation. It suffers from over-governance with four principal councils providing services to a population of just over 400,000 people. So we gave an invitation to councils to come forward with proposals for unitary local government or with proposals for enhanced two-tier working to overcome the challenges. As I said, on each occasion, the choice whether to come forward was absolutely up to them.

It has been more complex in Bedfordshire, which is why this is the last order and why the timetable is challenging—I take that point. The complexity has arisen because in response to the invitation we received not only competing proposals but a proposal which met the criteria, but which was in our judgment unviable without a satisfactory unitary solution for the rest of the county.

The chronology is slightly complex, so I will explain. In January 2007, in the first stage of the process in Bedfordshire, we received three separate proposals for unitary structures in response to the original invitation. There was a proposal from the county council for a unitary county; a proposal from Bedford Borough Council for a unitary Bedford; and a joint proposal from Mid and South Bedfordshire District Councils for a new Central Bedfordshire unitary for the rest of the county.

We assessed the proposals and judged that the Central Bedfordshire proposal did not meet the five criteria set out in the invitation; therefore, unlike the county and borough’s proposals, it did not proceed to stakeholder consultation. Noble Lords will remember the five criteria—they are a bit like the five tests—that we set out in the original invitation, which those two proposals were judged to meet. One was the strength of strategic leadership; another was the degree to which local communities and neighbourhoods would be involved in decision-making in future; the third was the value for money in improving public services—in other words the long-term outcomes that we seek. They also involved judgments about whether the proposals were financially affordable; and whether there was a range of support sufficient to make us believe that if the proposals went ahead, they would be a success.

In the case of Bedfordshire, we came to the judgement that both the county council’s and the borough council’s proposals met each of these five criteria. However, the Bedford Borough proposal was the one that we judged would deliver to a greater extent the long-term outcomes that we were seeking. We made the means by which we would choose between the two competing proposals that each met the criteria clear in the consultation paper published on 6 June 2007. In July, we announced that we were “minded to” implement Bedford Borough’s proposal. We made that announcement in the full knowledge that if the proposal were to be implemented, the rest of Bedfordshire would be unviable as a two-tier local government area.

That was not, as may have been suggested, a perverse decision. Our view was that the county council’s proposal would not deliver the long-term outcomes that we seek to the same extent. We wanted the best outcomes for the people of Bedfordshire and therefore decided, despite the fact that there was no viable alternative for the rest of Bedfordshire, to announce that we were minded to implement Bedford’s proposal.

We also announced at the same time our intention to issue a further invitation to all the remaining councils in Bedfordshire to put forward unitary proposals for the rest of the county. That was on 19 November. We could not have issued that earlier for two reasons. First, in the light of several challenges brought by councils against the Secretary of State in relation to the “minded to” decisions and the first pre-statutory invitation, it was appropriate to wait for the Local Government and Public Involvement in Health Act 2007 to receive Royal Assent before issuing an invitation, so that we could make that invitation on the basis of the provisions in the Act. Secondly, in the routine that we followed, we identified certain risks to Bedford Borough’s financial case. We therefore requested extra information, and it was sensible to wait until that had been thoroughly assessed by the independent financial experts. In fact, they confirmed that the risks were neither material nor significant.

We gave councils four weeks to respond to that because we wanted to minimise the period of uncertainty, which has always been a consideration. We also made clear in July that we were going to issue a further invitation for the remainder of Bedfordshire, so councils had an extensive opportunity to get together to do the preparatory work. We hoped that all the remaining councils in Bedfordshire would co-operate to submit a joint proposal, but that did not prove possible. Instead, we received a new and much improved proposal from Mid and South Bedfordshire district councils for a unitary for the rest of Bedfordshire to be called Central Bedfordshire.

So, as we were required to do by the 2007 Act, we began a further consultation in December, in which we asked stakeholders to specifically comment on the extent to which the central Bedfordshire proposal, together with Bedford Borough’s proposal—the two-unitary solution for Bedfordshire—were likely to meet the outcomes specified by the five criteria set out in the invitation. We also requested that respondents consider whether the two-unitary option on the table or the single-unitary proposal made earlier by the county council would better achieve the long-term outcomes specified by the criteria. There were two options to consider. We allowed eight weeks for consultation, which was justified because of the preparatory work, the long and protracted process and the fact that there had been an earlier consultation on the proposals from Bedford Borough and the county council. We felt that an eight-week consultation period would allow us to press on towards implementation on 1 April 2009 and thus avoid another year of uncertainty and potential disruption.

The two critical issues were support and affordability. I know that we have gone over this ground quite a lot in Committee and in the House. The definition of “broad cross-section of support” is whether a new unitary authority would genuinely meet its objectives and work for local people because it had the support of critical partners outside local government, including health or police services, which would have to make it work. That is not the same as popular support; it was not a test of public opinion.

We left it to the local authorities to solicit opinion locally in the way that they thought effective. We received evidence reflecting divided opinion, divided politics and divided loyalties. It is clear from that that the two-unitary solution commands support from three of the four principal councils in Bedfordshire, but there was strong opposition from the county council. Those divided loyalties were reflected in local polls, and a poll conducted by the county council showed that 46 per cent of those polled preferred the single-unitary proposal. Bedford Borough, however, submitted a petition with over 30,000 signatures in support of its proposal. The county council submitted a petition with 30,000 signatures as part of its “save our services” campaign. It was very evenly divided, as was stakeholder opinion. While there was a consensus from the majority of respondents in support of a unitary local government solution, in whatever form, for Bedfordshire, it is fair to say that a majority of representations received from public sector stakeholders expressed a preference for the county’s single-unitary proposal.

However, as I said before, it is not and never has been about majority opinion. The two-unitary solution has support from some public sector stakeholders, the business community, education and housing, as well as some third sector support and support from some town and parish councils. We thought that was sufficient support to ensure that it would work.

In terms of affordability, as we followed for the other unitaries, the transitional costs must be expected to be more than offset by the savings that the proposal is estimated to generate within a period of less than five years. We used an independent assessment; we did not come to the judgments alone. The financial cases were subjected to rigorous and independent scrutiny by ex-local authority chief finance officers employed by the department through CIPFA and IPF. They went over all the figures for both the Bedford Borough and Central Bedfordshire proposals in the light of the further information that we requested. They undertook their own modelling and made their own assessment of the risks, and concluded that the two-unitary solution was a medium risk, but that it met the affordability criterion with a payback period of less than five years. They concluded that the levels of savings envisaged were about £18 million a year, which is the high end of the sort of savings that we have seen from other unitaries. In short, the proposals met the affordability criteria and will deliver savings that can be reinvested in local services or in reducing council tax.

As I said earlier, a decision on which proposal to implement where there are alternative proposals is not about support or affordability; it is about which one delivers to the greater extent the long-term outcomes that we are seeking. After considering all the relevant information, the Secretary of State concluded that the two-unitary solution would deliver those long-term outcomes to the greater extent, particularly as a two-unitary Bedfordshire would be better focused on the different needs of urban Bedford and the predominantly rural middle and south of the county.

The noble Baroness has rightly said that we are tilling well tilled soil. My only comment on that is that, with all my agricultural experience, I have always found that if you till soil too much it becomes infertile.

Really?

Yes, it does; it is quite interesting.

I find it ironic that the Minister pleads post facto legislation—I do not think it is retrospective legislation—as justification for this process. If post facto legislation is a new term, I am sorry but it is appropriate in this case. As the Minister probably rightly argues, if there is a judgment on the original judicial review, it has in effect been superseded by legislation subsequently passed. Even if the judgment went against the Government, I suspect that the Minister is absolutely right that the lawyers would say that what the Government have done should stand.

I also accept the difficulty we face in that we are now electorally right up against the gun. Any delay would be very unfortunate. It is a reality, and I would have to plead when we come to other cases—as we unquestionably will, because there are a few more carcasses in the game larder that must be brought out when they are suitably ripened—that they be brought out with sufficient time not to be rushed in quite the way Bedfordshire will be, and as Cheshire was a little while ago.

I am bound to say that this is yet another chapter in this local government restructuring. It seems that both Cheshire and Bedfordshire will leave a nasty taste in the mouths of their local communities. Of course, the communities and their councillors will come together and make these proposals work. I have said time and again that local councillors have had to make systems imposed upon them work, whether or not they are good, right or effective. It is what local councillors do, and I repeat my tribute to them. Whether I should be concerned if the Government go around the country leaving a nasty taste in local communities’ mouths is entirely another matter. However, I cannot help but feel that that will probably be one of the effects of this exercise; although it will unquestionably die as time passes and people get used to the new system.

I have not been able to decide entirely what the Government’s purposes are in undertaking this exercise; they are certainly not to deliver the most cost-effective and efficient delivery of services. It is not the most representative system. The existing system is far more representative, if you count the number of democratic representatives, than the new systems will ever be. I wonder if this is change for change’s sake. I have always argued that everything that is done can always be done better, but that does not necessarily mean it is right to change things.

Anyway, there is nothing more I can say on this particular cusp. This has arrived at the point where any further obstacles would do harm to Bedfordshire, which I am not in the business of doing. Therefore, even if I do not particularly like the proposal, I shall not oppose it in any way.

I am grateful to the Minister for her detailed explanation of the timing, but we are perilously late getting these orders through. Will she say how perilously close we are? My understanding is that if the orders were not passed today, it would be too late to cancel the elections. That is what I was told. It cannot be right—the orders will not officially be passed until they have been through the House on Thursday—but we are very much at the 11th minute of the 11th hour. Perhaps this is a cheap point, but I will make it anyway: it sometimes feels that central government are very much on the backs of local authorities for not getting things done in a timely fashion, and it sometimes behoves the Government to do the same. This does not look good from the point of view of the local authorities.

With regard to elections, it is probably due to my inability to read the order properly, but I was struggling to find the references to when the mayor of Bedford will be up for re-election. I found the piece about the councillors, but I was struggling to find when the mayor would be re-elected. It occurs to me that the current mayor was elected as the mayor of a borough, and that being a mayor of a unitary authority, providing education and social services, is a quite different job. The mayor should have a new mandate.

I note that the Minister has breathed a sigh of relief at this order being the last in the current tranche. In many ways, however, it is a first: this is the forerunner of the unitary bids by county towns. We will be dealing with those further on in the pipeline; certainly in my own area of Suffolk we are very exercised by this. Most of us can understand why county towns, particularly historic boroughs, want unitary status—that is perfectly understandable—but it leaves the question, which the Minister has spent quite a lot of time on today, of how one deals with the rest of the county where there is no geographic coherence or sense of identity. On the whole, people in shire counties identify either with their town or with the county, and Bedfordshire has shown that up nicely.

I do not feel very much clearer about what criteria will be used when deciding the fate of Ipswich and Suffolk, Norwich and Norfolk or Exeter and Devon. I get a sense that I ought now to understand the ground rules, but I do not entirely feel that I do.

Once again we have heard examples of the different ways in which the protagonists have put forward the information about community support. That emphasises the point we have made before, that perhaps in future tranches the Government themselves need to take more of a hold on this so that the claims of support have some validity that we can all buy into.

There is a big dilemma in these county town areas. It bothers me that if we decide that the county towns are not of themselves large enough on current boundaries but they then expand too far, they lose the coherence that was the point of the bid in the first place as well as leaving the rest of the county rather stuck. It might be that a trade-off between coherence and size needs to be made here. I sincerely hope that we will have an opportunity to debate that in a more significant way than just when the orders come through.

I wonder whether I can ask one question. I apologise to the Committee for having arrived after the Minister had started speaking, but I did catch at the end of her remarks a reference to the Merits Committee’s request that;

“we invite the Government to explain more fully to the House what action they would take if the High Court’s ruling meant that the draft Order could not go ahead”.

Listening to the noble Baroness, the answer seemed to be, “We don’t believe that the court case will go the wrong way”. Does she have a more direct answer to the Merits Committee than, “We think it is going to be all right.”?

Can I just say how grateful I am for the way in which noble Lords opposite have worked with the Government on these orders? I am very conscious that, with this order in particular, we have come up to the wire. There are lessons that we can learn in the process. I am sure that when we reflect on—to use the wonderful analogy—the game hanging in the larder, we will consider how we do it and learn from the process.

The problem with Bedfordshire, as I explained, was that the politics were so complex that the timetable became extremely attenuated, and one of the consequences was the foreshortening of the consultation periods. Because everyone was going over the ground continually from last July, we felt that was sufficient, but we did all that we could to expedite it within the scope that we had. We are where we are. I did not quote at great length from the letters from the district councils, but a phenomenal amount of work is going on to put the new processes in place and to make sure that the services will be up and running, and that is going on with support from across the county.

In answer to the question of what would happen if by any chance the order was not passed—I hear that in another place both opposition parties have agreed not to oppose the order—a Motion will be on the Floor of the House on Thursday, and it will take effect on Thursday. If for any reason that did not happen, we would have to go ahead with the elections anyway; it would be too late. We were conscious of the timetable, and I make no bones about that.

On what the noble Baroness said about the future processes, we will all reflect seriously on what we can do to improve processes in the future as we come up to the three unitaries. There are also some lessons that we can learn about consultation and other things, which I want us to learn. The mayor is not in the order because the order does not affect the mayoral cycle. The mayor will come up for election as and when that is due—

I am grateful to the noble Baroness. Perhaps it ought to have been considered that there should be another election, because it leaves the mayor to run education and social services with no mandate for some time. I know that it is too late for this order, but perhaps the Government might consider that point.

Indeed, I take that point. The mayor was a very strong advocate of the unitary proposal. Now, he has been elected on a working mandate. In view of what the noble Baroness has said about consultation processes, relations with the new unitaries and so on, the consultation process would welcome any views. We certainly want to draw the attention of those who will make the decision to what has been said in this House at various stages about these processes. Of course, the process is open to noble Lords to take part and to make their views absolutely clear.

Finally, I turn to the question asked by the noble Baroness, Lady Hamwee. I responded as I did to the Merits Committee because that is our absolutely serious judgment—for the reasons not least picked up by the noble Lord, Lord Dixon-Smith. We have not speculated on what the implications would be if the order were to be quashed. My understanding is that, with the order having gone through, it might not be possible for the court to do anything other than accept that it had gone through. I have gone as far as I can in trying to explain why, in terms of the process and the timing, we do not think that it is likely that the court will come to that conclusion.

I am grateful to all Members of the Committee who have spoken. We will follow up what has been said. I am very willing, as are our officials, to talk to noble Lords about future processes in the context of the orders that will come forward in due course, and about the principles and the processes that have led us to this situation today. I am very grateful for the support.

On Question, Motion agreed to.

That completes the business before the Grand Committee this afternoon. The Committee stands adjourned.

The Committee adjourned at 6.21 pm.