My Lords, before the Minister moves that the first statutory instrument be considered, I remind noble Lords 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 Motions to approve the statutory instruments will be moved in the Chamber in the usual way. I remind your Lordships also that, if there is a Division in the House, the Committee will adjourn for 10 minutes.

That the Grand Committee do report to the House that it has considered the Concessionary Bus Travel Act 2007 (Variation of Reimbursement and Other Administrative Arrangements) Order 2010.

Relevant document: 9th Report from the Joint Committee on Statutory Instruments.

My Lords, buses are the most widely used form of public transport in this country. Over two-thirds of all public transport journeys are made on them. Buses are particularly important for some of the most vulnerable people in our society. For many older and disabled people, buses provide the only link to the places they want to go and the people they want to see.

As your Lordships will be aware, the statutory minimum bus concession was extended in April 2008 to provide free off-peak local bus travel anywhere in England for older and disabled people. The England-wide bus concession is now hugely popular. It provides an opportunity for greater freedom and independence to around 11 million older and disabled people. I should at this point declare an interest as a holder of a national concessionary bus travel pass—in common, I believe, with 84 per cent of Members of your Lordships’ House.

The structures in place to administer concessionary travel and to reimburse bus operators for providing it have remained largely the same today as they were when a statutory minimum bus concession was first introduced in 2001. Taking into account the significant increase since 2001 in both the number of concessionary trips being taken and the amount of money consequently at stake, the Government in April 2009 launched a consultation to consider what improvements could be made to resolve some of the problems with the current system.

The consultation expressed the Government’s preference for a shift in responsibility for both the statutory minimum and discretionary concessions to upper-tier local authorities. Discretionary concessions are those that are offered as enhancements by local authorities, such as peak travel, companion passes and travel on other modes of transport, such as the railway. The majority of respondents to the consultation were in favour of moving the administration of the statutory minimum concession to a higher tier of local government. Only 23 per cent of respondents considered the current level of responsibility to be the most appropriate.

The responses to the question as to who should administer discretionary concessions were more mixed. The Government believe that it will be more efficient for operators and authorities to keep responsibility for the statutory minimum and discretionary concessions together. Therefore, given the majority view in favour of upper-tier administration for the statutory minimum concession, the order moves the responsibility for administering both types of concession to upper-tier local authorities.

The Government believe that the change in administrative responsibilities will bring with it many benefits, including: enabling efficiencies to be realised through economies of scale and by reducing the number of negotiations with bus operators; making accurate funding by formula easier, due to less variation in the size and characteristics of the authorities; harmonising concessionary travel and wider transport authority responsibilities for the first time; and assisting with the widespread implementation of smart ticketing.

I am sure that your Lordships will agree that the changes being implemented by the order will assist in securing the sustainability of this hugely popular scheme for the future. I commend the order to the Committee.

My Lords, I thank the Minister for introducing the order and confirm that we on this side of the House have always been supportive of the national concessionary bus fare scheme. We recognise that access to public transport is particularly important to the elderly and those with disabilities, as he said. However, we have always been worried about the mechanism for funding the scheme set up by the Government, and have felt that it was not fit for purpose. Our fears have been realised since the introduction of the scheme, as a huge number of local authorities have been left with a shortfall in funding. For some years, we have called on the Government to review the funding mechanisms.

I therefore welcome the fact that, belatedly, the Government have acknowledged the problems with this scheme and have proposed three measures to address them. The first is to reopen the final year of the agreed three-year funding settlement. That is highly controversial and most unfortunate, and has led already to great uncertainty, especially in London. The second is to link the eligibility criteria to the state pension age, which we think is sensible as it ensures that the scheme is targeted at those who need it most.

The third is the subject of today's order and relates to moving the administration of the scheme from travel concession area to county level. We also consider the move to county level to be sensible and something that will help iron out local inconsistencies, as the Minister described. We need to rid ourselves of the situation where one area receives inadequate funds and is left with no choice but to cut services and raise council tax, whereas its neighbour has plenty of funds. The whole system has therefore become little more than a postcode lottery. It might be worth looking at Lancashire for a moment. The borough of Preston faced a shortfall of £824,000 in respect of the scheme, yet just down the road in Blackburn the council had surplus funds. Half the boroughs in Lancashire were getting too much money, and half were not getting enough. Those unfortunate enough to live in one of the boroughs with a shortfall could expect reduced services and the possibility of increased council tax. The concession areas were too small, and widening them will be of benefit.

I am therefore happy to support the order. However, I would like reassurance from the Minister on one or two points. First, can he confirm that the change will apply to all travel concession areas outside of the passenger transport executives and London? Secondly, what will the administrative costs of this change be, and who will bear them? Thirdly, what impact will this have on the revised three-year funding settlement? Fourthly, what does the Minister believe the impact will be on previously agreed reimbursement deals between travel concession areas and bus operators? Is it likely that those will have to be renegotiated?

Pending the answer to those four questions, we are happy to accept the order.

My Lords, the move to the upper-tier authority is long overdue. A plethora of negotiations has fallen very heavily on small bus operators that are negotiating with several local authorities about very small sums of money, and the administrative burden has certainly been far too high.

Will the Minister reconsider the problem of the border areas? The other day, someone from Church Stretton told me that they could go to Norwich on their bus pass but not to Knighton, which is the nearest market town. That may or may not be true, but there are problems in border areas and I hope that, through discussions with the Welsh Assembly and Scottish Parliament, these problems will in time be removed.

The real problem, as the noble Baroness, Lady Hanham, said, is that some authorities are getting more money and some are getting less. The move towards upper-tier authorities will help to put this right, but probably the only way in which to put it right is to introduce smart cards. There will be some time lag from now to when these are introduced. I urge the Government to keep a firm eye on the allocation of money to people who need it to be certain that it is not going to people who do not need it. Will the Minister assure me that this subject will continue to be kept under review?

There is also provision in the arrangements to ensure that bus operators will be no worse or better off as a result of the scheme. However, my attention is drawn to a number of areas that have capacity problems. So many pensioners are travelling that bus routes have to be duplicated at least. I was in Swanage recently when five buses had to be provided to take all the people home who had gone there during the day. This creates very bad peak problems for the operator.

I also draw the Minister’s attention to the fact that the system does not work very well in rural areas, where people make long journeys. People who make journeys within a town generally make fairly short journeys, and one can understand why. Old-age pensioners have found that they can make very long journeys in rural areas, often through attractive scenery; it is an opportunity to have a day out. Again, however, the operators of these local services suffer. Will the Minister assure me that the Government continue to review what is happening so that the burden of cost falls fairly and is adjusted as and when necessary? Other than that, I am quite happy to support the order.

My Lords, I have just one point about concessionary travel to raise with my noble friend as a follow-up to paragraph 7.1 of the Explanatory Memorandum, which states:

“The introduction of free off-peak local bus travel throughout England from 1 April 2008 has given the opportunity for greater freedom and independence to around 11 million older and disabled people. The policy recognises the importance of public transport for older people and the role access to transport has to play in tackling social exclusion and maintaining well-being”.

Many people feel that it would extend still further the opportunity for greater freedom and independence to older and disabled people if the national concessionary bus pass in England and the senior railcard, which entitles holders to a significant discount on rail fares, were brought together. In other words, holders of the concessionary bus pass would also be able to claim the discount on rail fares but would not have to pay what is currently £26 each year for the railcard. Will my noble friend confirm that the Government are aware of this view, which I support? Will he also say whether the Government either have considered it or would at some stage be willing to consider it? In conclusion, I declare an interest as a holder of both a senior railcard and a concessionary bus pass.

My Lords, I had not intended to intervene in the debate until I heard the noble Lord. I declare an interest as a holder of both a senior railcard and a concessionary pass that in London is called the Freedom Pass. This is free: on it is written,

“paid for by your local council”.

The senior railcard costs me £26. Does the noble Lord propose to cancel the £26 payment, to charge for the Freedom Pass, or to have two different regimes?

I would propose—obviously we would need a date for this to come in—that the concessionary bus pass should entitle you to go to a railway ticket office and use it as a senior railcard without having to pay £26 to get a separate card. In other words, it would also serve as a senior railcard to give you the discount that the senior railcard currently gives older people.

My Lords, it has been a very interesting debate, and I thank all noble Lords who have taken part. I will do my best to answer the points that were made in the course of it. I sense from the Committee that we are all agreed on how important the concessionary bus travel scheme is for older and disabled people, and on the need to ensure its sustainability for the future. There is no political difference between the parties on that issue. The Committee understands the benefits of the administrative changes that the order before us will bring about, by harmonising concessionary travel and transport authority responsibilities to enable efficiencies to be realised by —for example—reducing the number of negotiations with bus operators.

As I indicated earlier, the Government have consulted widely on the improvements needed to the current system. The changes being taken forward, particularly with respect to the mandatory concession, were supported by the majority of respondents. The Government understand the concerns expressed by some about the loss of lower-tier discretionary powers under the option that is being taken forward. However, the order does not remove the ability of district councils to consider discretionary travel schemes using the “well-being powers” contained in the Local Government Act 2000. Furthermore, the order does not preclude upper-tier authorities from maintaining or introducing district or local-level discretions—for example, where there are differing needs within different parts of a county. Neither does it preclude district councils from providing funding to county councils to administer discretionary concessions on their behalf.

The Government acknowledge that there will be financial implications for both lower-tier and upper-tier authorities as a result of the changes being introduced. It is expected that from April 2011, all funding for concessionary travel will be provided to local authorities via the formula grant funding system. Therefore, it is not possible to consider the financial implications of this change at an individual authority level in isolation from the wider local government finance settlement. I will address more specifically the point raised by the noble Baroness in a moment.

The Department for Communities and Local Government will consult later this year on how the financial implications of the changes will be taken forward as part of the overall consultation on the next local government finance settlement. These changes provide an opportunity to look again at how the totality of funding for concessionary travel is distributed from April 2011. We will also be able to look at the issues that the noble Lord, Lord Bradshaw, raised.

I shall deal with some of the questions that were raised in the discussion. The noble Baroness, Lady Hanham, asked whether the order impacts on London or the PTEs. The answer is that it does not impact on London, but it does impact on the metropolitan districts in PTE areas. They will no longer be able to enter into discretionary schemes under the 1985 Act. We expect administrative costs to be minimal in terms of transitional costs but, if the counties feel that they will incur any additional costs in 2010-11, the DfT is willing to consider that. Overall, however, we estimate that the changes will generate approximately £3 million in efficiency savings each year.

On special grant, by comparing concessionary travel spending in 2007-08 and 2008-09, we have been able to estimate where there might be funding shortfalls and where some authorities might have been receiving excessive grant. As it transpires, the vast majority of authorities have received sufficient grant funding to cover the costs of the recent improvement in the statutory minimum concession. However, we are aware that around 30 authorities out of the 264 which now receive the grant may have a genuine cause for concern over the level of grant they have received, which is the point made by the noble Baroness. We decided that the fairest course of action was to consult on a revised grant distribution for the final year, 2010-11, of the original three-year settlement. That consultation process began on 4 November 2009 and closed on 30 December. Our aim in this work was to deliver a fairer distribution, but to minimise the impact on local authority finances by changing as few payments as possible. Where grant payments have been reduced, the new distribution still leaves those authorities which benefited from the original distribution receiving more than sufficient funding to meet the additional costs of the new statutory minimum concession in 2010-11.

I hope that the Minister will be able to answer a question, although I am happy for him to write to me. A curious aspect of the scheme is that it seems that a negotiated settlement can be reopened in the third year. How often does this happen? Is this normal practice or was it quite unusual in these circumstances?

I understand that it is something that is possible with the special grant formula. However, if it would be of help to the noble Baroness, I will write to her with a more detailed explanation.

The noble Lord, Lord Bradshaw, raised the question of border journeys. As we have heard, this affects people living in, say, Craven Arms wanting to do their shopping across the border in Wales. The order does not impact on the ability of local authorities to implement discretionary cross-border schemes, other than that, from April 2011, changes to these schemes will need to be agreed with the relevant upper-tier authority in England rather than with the district authority. We hope, therefore, that people will be no worse off as a result.

I turn to the question of “no better off and no worse off”, also raised by the noble Lord, Lord Bradshaw. I remind the Committee that travel concession authorities are required by law to reimburse bus operators for carrying concessionary bus travellers on the principle that the operators are no better off and no worse off by taking part in concessionary travel schemes. The existing reimbursement arrangements involve a need to make a number of assumptions and estimations with regard to matters such as average fares and the number of trips that would have taken place in the absence of a concession. This can make the negotiation of reimbursement terms quite complicated, as I am sure the noble Lord will recall from his days of running a railway and similar considerations applied there. The department is considering options for improving the current method of reimbursing bus operators for providing the statutory minimum concession, and we hope to implement any changes at the same time as the administrative reform in April 2011.

My noble friend Lord Rosser asked about the senior railcard, while the noble Lord, Lord Jenkin of Roding, in a most welcome intervention, raised the same issue. We are aware that there has been a lobby—led, I think, by the National Pensioners Convention and some trade unions—for the possibility of combining the senior railcard with the concessionary bus pass. I think that they had in mind, as my noble friend Lord Rosser indicated, that the senior railcard would effectively be merged with the concessionary bus pass, and the concessionary bus pass would carry with it the entitlement to the sort of discount on railway travel that the senior railcard does.

Research was carried out on this in 2003 by Oxford Research, which indicated that journeys made by the senior railcard appear to be revenue abstractive, and become generative—worth while for the train operators—only if you include the revenue generated by the sale of the card. However, the Government are aware that there is great interest in this issue and that people are asking for the roles of the senior railcard and the concessionary bus pass to be considered. We are considering how best to take this forward and what further evidence might be required.

The noble Lord, Lord Jenkin, raised the question of the Freedom Pass in London, which is available to all eligible older and disabled people whose sole or principal residence is in London. Residents outside London, but in England, are now eligible for the England-wide bus pass and therefore can use that pass to travel on buses when they visit London.

I have used my bus pass in many parts of the country, including Scotland.

I do not think that the noble Lord is able to use his bus pass in Scotland. I do not think that it entitles him to free travel on buses there.

I am sorry—it may have been some months ago, but I certainly did. My wife has relations who live in Edinburgh, and when we got the bus from Waverley station to where they live, I asked, “Am I entitled to use this pass?”. The driver said, “Yes, of course”.

That is probably because it is granted on a discretionary basis. I had exactly the opposite experience in Cardiff two weeks ago when I attempted to use my Worcester bus pass and was told very firmly that it did not operate outside England.

I hope that I have allayed concerns about the ability of local authorities to maintain the existing discretionary enhancements that are provided for residents, and that I have also made clear that the financial implications of the changes will be considered alongside other changes being made in the overall finance settlement for local government. I hope that the Committee will agree that the changes being implemented by the order will assist in securing the sustainability and the long-term life of this hugely popular scheme for the future. I commend the order to the Committee.

That the Grand Committee do report to the House that it has considered the Renewables Obligation (Amendment) Order 2010.

Relevant document: 8th Report from the Joint Committee on Statutory Instruments.

My Lords, the purpose of the order is to make some changes to the renewables obligation, encouraging a higher level of renewable generation and providing increased support for offshore wind.

Decarbonising our energy system is more important than ever. By 2020 we want to be firmly on track towards achieving our commitment for an 80 per cent reduction in carbon emissions by 2050. Renewable energy from water, wind, sun and sustainable biomass will play a crucial role in making that happen and be vital for our energy security in years to come. That is why the Government have been instrumental in pushing for effective and binding EU targets, and have published a UK action plan for achieving our legally binding target of sourcing 15 per cent of our total energy from renewables by 2020. We will need radically to increase our use of renewable electricity, heat and transport to meet that challenging target, and large-scale electricity generation will have to play a central role.

The renewables obligation is the Government's main mechanism for supporting the generation of renewable electricity in the United Kingdom. The order builds on what has been achieved thus far and will help to drive forward the additional generation necessary to meet our share of the target. Since its introduction in 2002, the RO has incentivised significant amounts of eligible renewable electricity. In 2008-09 there were 5,100 stations accredited under the RO, generating 19 terawatt hours. We have seen the amount of onshore wind electricity more than double since April 2006, delivering 6.2 terawatt hours. For the first time, more electricity has been generated by offshore wind sites in England than was generated by onshore wind. But we now need it to deliver even more.

The changes that we are introducing apply to England and Wales. Scotland and Northern Ireland are bringing in complementary orders which will work together to create a United Kingdom renewables obligation.

Perhaps the most significant change, and perhaps the most welcome, is the increase in the level of support from 1.5 renewables obligation certificates per megawatt hour to two ROCs per megawatt hour for offshore wind stations for capacity accredited between 1 April 2010 and 31 March 2014. That increased support will apply to the whole station accredited within the period or to all the additional capacity accredited in the period. It therefore includes any turbines that form part of the station or the additional capacity, even if some of those turbines are yet to be installed.

Offshore wind is an important technology for the United Kingdom and is expected to play a vital role in meeting our renewable energy targets. We are now number one in the world for offshore wind. It is crucial that we maintain the momentum and ensure that investment is attracted to the UK. We have worked closely with industry in developing the change. After commissioning a study into the costs of offshore wind and extensive consultation, we are confident that projects will now receive the right level of support to proceed. In accordance with our grandfathering policy we intend that, once a station or additional capacity qualifies for the two ROCs, the electricity that it generates should remain eligible for that level of support for 20 years from the date of accreditation, subject to the 2037 end date.

The order also allows us to take the steps to give investors the long-term certainty necessary to incentivise them to invest in new generation up to 2020. As announced in the Pre-Budget Report, the extension of the lifetime of the renewables obligation by 10 years to 2037 will ensure that projects in technologies such as marine and round 3 offshore wind, due to come online from 2017, will be able to benefit from RO support. However, in light of that extension, we are mindful of the need to avoid overcompensation and ensure value for money to the consumer, so we have limited support to a maximum of 20 years. This will apply to stations that receive full accreditation on or after 26 June 2008, which will receive support for 20 years or until 2037, whichever is the sooner. A further period of 20 years' support will apply when capacity is added to any generating station—again subject to the 2037 end date. As is currently the case under the Renewables Obligation Order 2009, generating stations accredited before 26 June 2008 will continue to receive support until 31 March 2027.

In order to allow renewable electricity generation to grow as much as possible, we have also removed the 20 per cent cap on the size of the obligation, and increased the level of headroom—that is, the set margin between predicted demand and supply of ROCs—from 8 per cent to 10 per cent from the 2011-12 obligation period, to ensure the stability of the market for renewables obligation certificates.

This increase in the level of headroom builds on our commitment to making the ROC price more stable and predictable. This not only provides greater certainty to investors but helps to ensure that in future years the consumer is not paying more than required to bring on this renewables generation. Given the current economic climate, I am sure that noble Lords will agree that these considerations are extremely important.

Over the past few years we have introduced a number of changes to the RO in order to make it easier and more attractive for microgenerators to join the scheme. Despite these however, we recognise that it remains better suited to professionals in the energy sector. The Government are therefore introducing a feed-in tariffs—FITs—scheme from 1 April this year to support the generation of low-carbon electricity by small-scale projects up to a maximum of 5 megawatts. Offering a fixed level of reward for each unit of electricity generated should provide the simplicity and certainty required to encourage households and communities to generate their own electricity from low-carbon sources.

In anticipation of the FITs scheme coming into force, the order removes from the RO all microgenerators in the technologies that will be eligible to claim FITs, so that they can join the new scheme from its start. As FITs will be a more appropriate support scheme at the microgeneration scale, we intend for it to replace the RO completely in providing support for generators up to 50 kilowatts in anaerobic digestion, hydro, solar photovoltaic and wind power. Microgenerators in other technologies will of course remain eligible to receive support through the RO.

It is a slightly different story at the small scale—covering generators above 50 kilowatts and up to 5 megawatts in capacity—because the appropriateness of either the RO or FITs will depend on the circumstances and preferences of the individual generator. That is why small generators who joined the RO on or after 15 July 2009 and before the FITs scheme comes into force will be able to elect to transfer to FITs during a defined period. Small generators who had already joined the RO before 15 July 2009 will remain in the RO, and new small generators at this scale after the FITs scheme comes into force will need to make a one-off choice as to which of the two schemes they wish to join.

We are making a few small technical and administrative changes to the order to improve the way the RO works. For example, we have clarified when ROCs can and cannot be issued and revoked, and excluded landfill and sewage gas from sustainability reporting, because we do not believe that any value is added in requiring reports for those sources.

We have consulted extensively on these changes, which have been warmly welcomed by the renewables industry. However, I must point out that—as with previous renewables obligation orders—we have notified the European Commission about the amendments that we intend to make to the RO for state aids purposes, and we are awaiting its response. We intend that the order will come into force on 1 April.

The changes that I have presented to the Committee put us on a firm path to developing our renewable electricity industry, which will be vital for decarbonising our energy supplies. I commend the order to the Committee.

My Lords, the Minister has been good in outlining the scope of the wide-ranging order. I assure him that I will not seek to cover the whole field.

The issue that interests me is not actually in the order; rather, it is the complaint that considerable effort has been made and discussions have been had with DECC on the suggestion that the cap on co-firing of biomass with coal of 12.5 per cent, set in the preceding 2009 order, is too restrictive, and that the figure should be raised to at least 17.5 per cent. That is what I am going to address today.

I want to get one thing clear first, though. The Minister talked about the discussions with the European Commission on “state aids”. I have long detected that, perhaps unintentionally, Ministers have sought to persuade the public that the subsidy for renewable is paid by the state. That is not so. I was surprised to read a short exchange in our debate on the national policy statements on 11 March when the noble Lord, Lord Willoughby de Broke, referring to the discussions that the Government had been having with the lady who is the chief executive of the Drax power company, said:

“I can guess how the conversation went. I expect that she wanted more taxpayers’ money to make biomass plants viable”.

Obviously, the noble Lord had bought the “state aids” possibility. The noble Lord, Lord Hunt of Kings Heath, then responded:

“My Lords, it pains me to say it, but the noble Lord is absolutely right”.—[Official Report, 11/3/10; col. 161.]

The noble Lord was absolutely wrong. The cost of the ROCs does not fall upon the taxpayer but upon the companies that have to buy their ROCs. It is then passed on to the customer in higher prices. A proper description of what the Government do is that they have put in place a system that makes consumers pay.

I apologise to those who were here on Thursday because I am going to quote again the figures that were given to me by Ofgem at a briefing a couple of weeks ago, headed, “Estimated average cost impact per household customer (i.e. costs added to gas and electricity bills) of main environmental schemes in 2008, 2015 and 2020”. The renewable obligation figure for 2008 is £10. I shall come to the other categories in a moment. By 2015 that figure will rise to between £38 and £47, and by 2020 it will rise to between £71 and £81—that is, between a sevenfold and an eightfold increase. That is the cost falling upon the consumer for the financing of the subsidy for renewable energy. The consumer is being asked to pay. Therefore, the noble Lord, Lord Hunt of Kings Heath, really surprised me when he said that the noble Lord, Lord Willoughby de Broke, was absolutely right. I suspect that he may have done so as a quick answer to an intervention.

My Lords, the main purpose of this order is to increase the level of subsidy made available for new offshore wind generation. It also extends the system for an extra 10 years, from 2027 to 2037, while limiting the access to the system of individual subsidy recipients to 20 years. So much for the principle that no Government can bind their successors.

The Explanatory Memorandum explains that this increase is being proposed following evidence that costs have risen. The subsidy available for offshore wind will rise from 1.5 to 2.5 ROCs per megawatt hour, while the subsidy for onshore wind will remain at one ROC per megawatt hour. Thereby, offshore wind is judged to require twice the level of subsidy as onshore wind. That does not seem to leave with much value, or even meaning, the boast that we frequently hear from Government, and which we heard from the Minister last Thursday:

“We have the best wind resource in Europe, and it makes no sense not to use it”.—[Official Report, 11/3/10; col. GC 172.]

This justification for increasing the subsidy also casts doubt on something else the Minister said here on Thursday:

“We think that it is best for us to go down the low-carbon route as quickly as possible, and the cost-effectiveness will become clear over time. I should also say that the more turbines we build, the more the cost will reduce. The whole renewable obligations system is based on the expectation that costs will come down, and I am sure that that will happen”.—[Official Report, 11/3/10; col. GC 175.]

I do not know what costs the Minister had in mind, but for the moment it is clear that the order is based on the belief that costs have risen, not fallen.

On Thursday, the noble Lord confirmed that the Government have in mind 10,000 new turbines, delivering up to 25 gigawatts of electricity by 2020. Asked whether he was confident that this target could be reached, he answered with an emphatic yes, in col. GC 173. I believe that more than half this total is expected to come from offshore wind—something in the order of 6,400 additional turbines. Perhaps the noble Lord would confirm that. But how realistic is it to expect that that target could be achieved? The rate is over 600 a year, or perhaps two or three or even five a day during the months when work at sea is possible. Given the competition for, and expense and shortage of, installation vessels to lay them, the target seems to be improbable in the highest degree. In Denmark a rate of two additional turbines a week was never exceeded.

The first report of the Committee on Climate Change, which we debated in the House before Christmas, stated that 10 installation vessels were required for targets to be met, only two of which were operating currently in the United Kingdom, and that there was a three-year queue for new orders. We were also told that the new vessels cost between £50 million and £150 million each. Perhaps the Minister could tell us whether the position has improved.

In any case, that is the target. It is an enormous target that is, in the Government’s view, worth imposing enormous additional expense on the electricity consumer. Page 22 of DECC’s summary attached to the order, under the third paragraph of the section on distributional impacts, states:

“The very approximate estimate of the consumer cost of both policies together taking account of the overlap”—

which I take to be the sum total of the effects of the order as a whole—

“is around £46 billion total from 2010 to 2030”.

As I said on Thursday, that breathtaking sum is likely to push us into the pole position of having the most expensive electricity in Europe—although it will be difficult to beat Denmark, which has a considerable lead in the reckless pursuit of wind power and very expensive electricity as a result—and at the opposite end of the spectrum to France, whose reliance on nuclear power has given it some of the cheapest electricity in Europe. Incidentally, France also has one of the lowest per-capita carbon-emission figures in Europe, unlike Denmark and Germany which have two of the highest. Altogether, that is a recipe for sending our industry overseas.

In the Explanatory Memorandum, we are not told in any detail how that figure of £46 billion is arrived at. I assume that it attempts to assess all the subsidy likely to be received in future years, until 2030, but not until 2037, by all offshore wind farms likely to be installed for the Government’s target to be met. Will the Minister confirm that, or state the assumptions behind the calculation? Are the consequent and necessary extensions to the national grid included or are they additional to that figure? If separate from that figure, what do they amount to and how and when will the consumer be asked to pay?

The Minister explained that this order also makes provisions regarding the feed-in tariff scheme, which is also due to come in on 1 April, but this order is not responsible for bringing that scheme in. I therefore presume that its costs are not included in the estimates attached to the order.

Last Tuesday, when we debated the nuclear national policy statement, the noble Lord, Lord Turnbull, referred to an article in the Guardian by George Monbiot in which that well known patron saint of the green movement came out against the FITs scheme and estimated its costs at some £8.5 billion, once again to be paid by the consumer. I do not know whether the Minister would like to comment on that estimate. I do not think his colleague did so last week.

In one of his articles this month on the feed-in tariffs scheme, George Monbiot referred to a study recently produced by Ruhr University. It perhaps played a part in turning him against the scheme. Germany has had a feed-in tariffs system for 10 years or so that applies to large-scale wind power as well as to renewable microgeneration. Germany does not have a ROC system. The study shows that its subsidy regime has resulted in 6 per cent of the country's electricity being produced by wind power at a cumulative cost to the consumer of up to €20 billion, were the scheme to end tomorrow, and in 0.6 per cent of the country’s electricity being provided by solar power at a cumulative cost to the consumer, were the scheme to be cancelled tomorrow, of €53 billion. The study concludes with these words:

“Although Germany's promotion of renewable energy is commonly portrayed in the media as setting a ‘shining example of providing a harvest for the world’ (The Guardian 2007), we would instead regard the country’s experience as a cautionary tale of massively expensive environmental and energy policy that is devoid of economic and environmental benefits”.

Just at the moment that Germany discovers all that wasted investment, we proceed to embark down the same path. Like the CCS levy, to be introduced in the Energy Bill, our feed-in tariffs scheme amounts to yet another large charge to be laid on the poor electricity consumer. I suggest that this order is asking the consumer and, through him, the country to pay more than either can bear for a solution that brings no measurable advantage to us or to the world at large. I hope that one day a Government will wake up, see sense and revoke it.

My Lords, like the noble Lord, Lord Jenkin, I shall comment on Drax and other users of biomass. As noble Lords know, there are two uses for biomass: co-firing and dedicated, 100 per cent, biomass units. In introducing this statutory instrument, the Minister mentioned guaranteeing grandfathering for 20 years from the point at which a plant is accredited, not the point at which it is constructed. This is important, of course, because construction takes a long time and involves a lot of money up front. It has an effect on the rate of return on the capital employed if plants take two, three or four years to construct. What are the Government’s intentions on grandfathering rights on the same basis for dedicated biomass plant? As with co-firing, that is the dog that does not bark. It is not in here. The Government must have considered it, but they have not included it in the order.

Turning to the question of co-firing, I will not repeat the many points ably made by the noble Lord, Lord Jenkin, all of which I agree with; I shall just add one or two others. I very much hope that my noble friend will be able to give some reassurance about the Government's intentions—I do not expect them to change their mind about the order now, but it is important to know their intentions for the future.

I should like to make the distinction between a cap, which limits the contribution towards electricity supply that can be made by co-firing, and the degree of support that is given. The degree of support given to co-firing is 0.5 ROCs per megawatt hour. Offshore wind already gets 1.5 ROCs per megawatt hour. In the order, that is increased to two. In other words, the degree of support given to wind will be four times that given to co-firing biomass. That indicates that offshore wind could not compete if it was not given such large support. Co-firing generation is economically a much better deal to get renewable generation. Whatever the question of the cap to be imposed, there can be no doubt that co-firing is not being given an unfair advantage in support; on the contrary, the support given to it will be a quarter of that given to offshore wind.

I turn to the question of the cap—that is, the number of ROCs that suppliers can acquire under the order. As the noble Lord, Lord Jenkin, said, the Government intend to keep that at 8 per cent. In the supporting documentation to the order, under the heading “Summary: interventions and options” on pages 4 and 5, it is made clear that the consultation considered the question of retaining the co-fired cap at 12.5 per cent. In other words, as the noble Lord, Lord Jenkin, said, there was consultation on that. It has not been merely reaffirmed, it has been considered. As the noble Lord said, the department not only consulted Oxera, it commissioned it to produce an independent report on the issue of the cap. It did not simply consult it; it asked it independently to consider the issue. The report is not flimsy; it is substantial. The noble Lord fairly informed the Committee of the findings of that independent review.

The explanation of the costs and benefits of the proposals under review is set out in the document, entitled “Summary: analysis and evidence”. No evidence is given at all about the consultation on keeping the cap on co-firing at 12.5 per cent, as opposed to raising it to 15 or 17.5 per cent or removing it altogether. I find that strange because the other elements of the consultation—the options to be considered, including the benefits and costs—are all set out for those who want to study them carefully. My question to my noble friend is this: given that this was a policy option that was consulted on, why are the options not set out along with the costs and the benefits so that noble Lords could reasonably consider the virtue of keeping the cap at the current level? That seems extraordinary and indicates that the Government are either not sure that they have a good case or perhaps have overlooked it. Surely it cannot be right to ask us to approve an order that contains one element which is to remain unchanged but for which options were considered, but for us not to be told what those options were and what are their advantages and disadvantages.

My Lords, I have listened to the debate so far and there is very little left for me to say. Nevertheless, I am going to say it.

I am one of those people who are rather sceptical of the contribution that CO₂ makes, and will make in future, to so-called global warming. Still, one has to look at the position of the Government, how they are going to meet their obligations and what effect that will have on industry, on consumers and, particularly, on the electricity supply industry. We have heard about some of those effects today.

I am also opposed to the dedicated growing of crops for energy generation. I have spoken, as have others, to Drax power station about the co-firing of its coal-fired station with biomass. Drax has assured me, and I believe it, that the biomass that it is using is from waste agricultural products, from forests that need clearing to enable them to regenerate and from sources that do not use good agricultural land for producing food. I have been quite impressed by what Drax says, and I understand its concern that the Government are giving it no particular priority—indeed, that they are shifting their priority to wind generation in order to meet their targets. As we have heard, Drax is currently constructing the largest co-firing facility in the world, with a capacity of 500 megawatts, and producing 12.5 per cent of its output from biomass will make enormous savings in CO₂ emissions of 2.5 million tonnes. That is the equivalent of 600 wind turbines, saving the equivalent of the CO₂ emitted by 700,000 cars. This is making a huge contribution to the Government’s obligations to Europe, and indeed to the rest of the world.

I do not want to repeat much more of what has already been said, but we have not yet dealt with the question of security of supply. Between now and 2015—and beyond—that will be one of the most difficult problems with which to deal. The great benefit of Drax, and perhaps other power stations later, is that it will be a base-load station and will produce electricity at maximum demand when needed and when the wind is not blowing. That really must be tackled, and it must be understood by the Government and by consumers—who, as we have heard, will have to pay an enormous premium on their fuel costs to finance 20,000 megawatts of wind power—that that power will not guarantee that we meet our demands in the winter, particularly at peak periods, or even make a large contribution to meeting them.

I urge the Government to look at this problem very seriously indeed, because they really are on the wrong track. It is essential that we provide power that will meet maximum demand. The maximum demand met during the recent cold snap was a record 58,000 megawatts, or just over, but this is likely to increase. Despite all the perhaps local savings in electricity, the very fact of population increase and more electricity use in what I hope will be additional manufacturing industry will increase the demand for electricity.

An Answer to a Question that I asked recently about wind power showed that, for most of the period since 15 January, the wind power system has provided less than 50 per cent of its capacity and frequently less than 30 per cent. Indeed, on three days of the winter freeze, it provided 10 per cent or less of demand. Its lowest output was 5 per cent, on 7 January. That is a warning to the Government that they need to look again at their policy on supplies if they are to meet maximum demand, particularly if we are going to have much colder winters than we have had for the past 10 years. They will fail in their duty to do so unless they re-examine their policy and reconsider the desirability of ensuring that co-fired electricity generation can take place, because it is economic.

My Lords, perhaps I can cast away some of the gloom that has descended this afternoon and congratulate the Government to some degree on the order, which concerns ROCs and FITs and which moves, on the whole, in the right direction. However, I will ask one or two questions. A couple of the issues have already been raised. I was interested that the Minister mentioned state aid. Having had a little bit to do with Europe, I know that DG Competition does not move fast. It probably has not escaped the notice of any noble Lord that we have 17 days left for this state aid to be cleared because the regimes start on 1 April. I would be interested to understand whether there has been any indication from the Commission that the state aid issue will be overcome. I presume that the Government do not think that it will be a major problem. I would also be interested to understand whether the state aid issue relates solely to ROCs or whether it relates also to feed-in tariffs. I am sure that the industry, too, would be interested in that.

After listening to the Minister, I was unclear about some of the microgeneration installations already in operation and about what options are available to individuals and households who have already put substantial amounts of money into generating renewable energy for their homes and to feed back on a small scale to the national grid. The Government and many of us have said that this is a good thing, but I am not sure that everybody will come off better from this order. What options are open to someone who put in a small-scale but quite expensive PV installation before July 2009? I thought that I understood them from part of the Minister's statement, but then he went through some other options that were less clear to me.

I am also concerned about the absence of co-firing. I find it difficult to understand the Government's position. I will not go into it at great length, because the noble Lords, Lord Jenkin, Lord Stoddart and Lord Woolmer, have discussed it. However, we all recognise the challenge of approaching, let alone achieving, the target of generating 15 per cent of energy from renewables by 2020, and we need all the ammunition that we can get. I find it strange that we put a restraint on a technology that can help to deliver the targets that all of us know are very important to decarbonise the economy by that date and onwards to 2050. I would like to understand the Government's logic in applying a cap. The rest of the issue has been well argued. Although I would understand if there were considerations around ensuring the sustainability of fuel, that is a separate issue from the cap itself.

Perhaps the Minister will also update us on where the renewable heat incentive has got to. That would be useful for the Grand Committee. Lastly, as so many matters have been covered, I would be interested to hear the Minister's prediction for the impact this package will make in terms of growth in jobs. How many jobs in the renewables sector do the Government hope to create through their strategy? I think that other noble Lords have said quite enough to enable me to sit down at this point.

Noble Lords will see from the previous order that the noble Lord, Lord Teverson, and I reverse our order on this subject because we learn so much from behind us before we stand up to speak and do not want to appear too foolish when we do so. The noble Lord said that we should be cheerier and more optimistic than we have been this afternoon. I think that the speeches we have heard from all sides of the Committee show unease with this order. That is worrying, and I am sure that the civil servants sitting behind the Minister will be having long talks with him afterwards.

We all agree that there is a pressing need to shape up Britain’s renewable energy regime. We know that the United Kingdom is third from the bottom in the European Union in the development of renewables. Only Luxembourg and Malta are behind us, in spite of us having one of the most generous systems of support. I shall leave out biomass and Drax because my noble friend Lord Jenkin and the noble Lords, Lord Woolmer, Lord Stoddart and Lord Teverson, described them well.

My general concern with the order is that I do not believe that it addresses the magnitude of the renewables challenge that we face. Perhaps the most important issue is the cost that these measures will impose on the consumer. The Minister alluded to this, as did the noble Lord, Lord Reay. Will the Minister provide the Committee with a greater understanding of the financial implications that the Government see these measures having on the public’s already ever-growing energy bills? Can the Minister explain the extent to which the British consumer will be paying to create jobs overseas by allowing renewable generation capacity to be developed overseas using British renewables obligation certificates?

The Government talk about the need to do more to support offshore wind, but I am concerned about the lack of consideration and development of other forms of marine renewable potential. We have 11,000 miles of coastline and the highest tidal reaches in the world. We should be a beacon for international investment and a place for developers to try out their projects and ideas. Can the Minister say what research is being done to explore these other methods and to attract international investment? What are the Government doing to protect and support wind technology companies that are already based in the United Kingdom? There are reports that two of the UK’s most advanced developers of wave technology—Pelamis and Aquamarine —are considering developing their technologies overseas. We must harness this section of the market and not let such a great opportunity to capitalise on forms of marine renewable potential other than offshore wind slip through our fingers. We cannot afford to do that. We believe that offshore wind has tremendous potential and an important role to play in the growth of renewables in this country. Does the Minister think that the temporary increase to two ROCs will be sufficient to deliver the increase that the Government want?

Beyond the financial practicalities of the Government’s offshore wind targets, the practicalities on the ground are harder to overcome. My noble friend Lord Reay outlined some of the problems that the Government are facing. We currently do not have the cranes, ships, money or skills for the sort of offshore operation that the Government will need to reach their targets. My honourable friend Charles Hendry estimated that:

“Currently, there are only a small number of ships in the world that can erect the turbines at sea. The most efficient of those can erect perhaps 80 turbines a year. The new ships will be able to erect 100 turbines a year. Even if every single ship in the world that can erect turbines was to come to the North sea to help us deliver our capacity, we would probably be erecting 400 to 500 turbines a year, but that is only if they started today and did nothing else for 10 years. However, we need to have about 1,000 turbines a year erected”.—[Official Report, Commons, Third Delegated Legislation Committee, 8/3/10; col. 7.]

What are Her Majesty's Government doing to address these problems, especially if we are to achieve the targets, which we all want? These questions aside, we support the order while recognising its shortcoming and seeing the trouble ahead.

My Lords, we have had a fascinating debate and, like the noble Baroness, I have learnt a huge amount from contributions made in all parts of the Committee. I thank everybody most sincerely for taking part in it. I shall do my very best to answer the points that have been made. If I leave any matters unanswered, I will of course write to noble Lords and make sure that copies are available to all Members who have taken part.

A number of Members of the Committee dealt with the issue of co-firing biomass. This was the main point made by the noble Lord, Lord Jenkin of Roding, and by my noble friend Lord Woolmer. We are aware of the concerns expressed by the Drax company, and it has clearly been very effective in getting its point of view across to Members of this Committee. I am sure that it will have been gratified by that.

Perhaps I should explain as background that the co-firing cap was originally introduced for stations that co-fired regular biomass because of concerns that, if it was not restrained, the co-firing ROCs could flood the ROC market and this could significantly decrease the value of ROCs for other technologies and result in investors placing a higher risk premium on their investment decisions. The Drax concern was that the cap on the co-firing ROC market restricts competition and disproportionately penalises independent co-firers, as vertically integrated suppliers purchase their own ROCs. Drax considers that the cap forces independent co-firers effectively to participate in a partitioned marketplace, which means that it has to accept significant discounts in price for its ROCs. I think that that is a fair summary of Drax’s point of view.

To help provide additional evidence on this, we instructed Oxera, to which a number of noble Lords referred, to look at these arguments and provide us with a report on the effect of the cap on the co-firing market. There were other points of view. Other respondents indicated that uncapped co-firing could lead to unpredictable fluctuations in the ROC price, so we asked Oxera to look at the effect on the wider ROC market of changes to the size of the cap, including its removal.

The Oxera report was published on 22 September. It did indeed say that increasing the cap would probably remove technical constraints in the short term, but it also said that in the long run the cap was unlikely significantly to affect the ROC market for co-firing. This is due in part to the banding allocated to co-firing in April 2009, which in effect doubled the amount of co-firing generation with regular biomass needed to receive one ROC: 2 megawatts as opposed to 1 megawatt. However, there is a suggestion that in the shorter term the cap may restrict independent generators’ ability to sell ROCs, as plants affected by emissions control legislation, under the large combustion plant directive, may now run at a higher capacity in the short term than originally envisaged.

In the consultation, we asked respondents whether the cap should be retained at 12.5 per cent or to provide evidence if they thought that it should be changed. Some respondents called for the co-firing cap to be tightened and for co-firing to be removed from the RO by 2016, as originally planned. However, the majority of respondents felt that the cap should continue at 12.5 per cent. The report also indicated that there would be a decrease in price and that biomass new generation would be delayed. The cost of raising the cap to 17.5 per cent was likely to be a decrease in the ROC value and a delay in new biomass generation that would come on stream, but we have decided to look at this in the banding review where we can assess the effect across the whole renewables market.

My noble friend Lord Hunt of Kings Heath has already had a number of discussions with Drax on how the department can help. I can announce today that officials will arrange further discussion and we have agreed to reconsider the matter as part of the banding review that begins in October.

My Lords, I apologise for intervening, but the noble Lord must recognise that the use of the words “state aid” implies that this is something coming from the Government, and therefore from the taxpayer. Does it not behove the Government to repeat on every possible occasion that in fact this is not paid by the taxpayer; it is paid by the companies and goes through to the consumer?

I do not disagree. The term “state aid” is almost a term of art that is used in Europe. All of us in this Room understand how the scheme is funded. We do not deny that driving up the deployment of renewables in this country will incur costs for consumers. However, I hope that all Members of the Grand Committee, with the possible exception of the noble Lord, Lord Stoddart, will accept that a reduction in the risk of catastrophic climate change and dangerous energy insecurity is the alternative to the move towards renewables. Those risks carry real and much higher costs than the increase in consumer prices which the renewables deployment will cause.

The report by the noble Lord, Lord Stern, showed that the damage caused by global climate change could cost five times more than the cost of action to stabilise global emissions by 2050. The Government believe strongly that the cost of meeting our renewables target should be seen as an investment to avoid much higher costs to the economy in the long term.

Members of the Committee asked for the figures for the RES on the impact of the measures to achieve about 30 per cent renewables electricity by 2020, covering large and small-scale generation. We estimate that under central fossil fuel prices, domestic electricity bills will be £77, or 15 per cent, higher than they would have been in the absence of the RES. The costs associated with the measures in the RO are expected to increase domestic bills by 12 per cent in 2020. For FITs, the latest estimate is £11—again, by 2020.

Returning to co-firing for a moment, I was asked about discussions with Ofgem. Ofgem has responded to consultations on that in the past. It is of the view that the cap should not be removed. As I said a moment ago, we take the view that we need to keep the matter under review and will look at it in the round.

Very briefly, I am remiss if the answer is straightforward, but are the various responses to the consultation on the co-firing cap, to which my noble friend referred, in the public domain?

I am assured that they are, indeed, in the public domain.

The noble Lord, Lord Reay, in a powerful speech, if I may call it that, questioned the thinking behind a lot of what we are discussing today and paid a lot of attention to the issue of offshore wind. He also drew attention to the fact that we are increasing the level of support for offshore wind projects that receive full accreditation between 1 April 2010 and 31 March 2014 from one and a half ROCs to two ROCs. We take the view that offshore wind is expected to make the largest single contribution to renewable electricity in the UK by 2020, so we have increased the level of support to ensure that momentum is maintained and there is confidence to take the projects forward.

The noble Lord also asked whether we are confident that we can meet the targets. The deployment of wind energy is rapidly accelerating, and the latest 1 gigawatt of capacity was added in less than a year. That compares with 14 years to deliver the first gigawatt, in 2005; 20 months to deliver the second gigawatt; and a year and a half to deliver the third. The experts in the industry predict that next year will see the installation of both the fifth and the sixth gigawatt in quick succession. To meet the lead scenario in the RES, we need to add about 1 gigawatt each of onshore and of offshore wind capacity per year from 2010 to 2020, with growth rates that rise towards the latter part of the decade. Our scenario suggests that we will need a total of 14 gigawatts of onshore wind and 12.5 gigawatts of offshore wind. That implies 15 and 21-fold increases respectively on where we are today. The noble Lord also asked how much all this offshore wind will cost. The Carbon Trust estimates that 29 gigawatts of capacity, to be installed in the next 10 years, will cost £75 billion, but, if he will forgive me, I will write to him with the other specific figures for which he asked.

The noble Lords, Lord Reay and Lord Teverson, asked about feed-in tariffs. By 2020, the feed-in tariffs are expected to lead to approximately 2 per cent of the United Kingdom’s electricity being generated by small-scale renewable technologies. This will allow households to generate their own electricity and raises awareness of green issues.

My noble friend Lord Woolmer talked about biomass grandfathering in the context of Drax and co-firing.

No, my Lords, it was in the context not of co-firing but of dedicated biomass.

I apologise to my noble friend for misunderstanding him. I am assured that DECC is working rapidly to resolve the situation with biomass grandfathering and is reviewing its policy on the matter. It has formed two working groups consisting of investors and industry representatives who have been recommended by the trade associations to help to inform the review. We plan to announce the way forward later in March.

My noble friend Lord Woolmer asked about integrated suppliers. Drax has suggested that licensed suppliers in company groups with generation arms may choose to buy from generation in their own groups and companies, but that argument is not yet proven because companies in groups are independent and must act in the best interests of their shareholders, so it may not work out like that.

The noble Lord, Lord Stoddart, raised the question of biomass and energy crops. Grants are available to farmers in England to help establish energy crops, and from January 2010 they increased to 50 per cent of establishment costs. Grants are available to farmers and businesses to develop biomass supply chains. We are funding a £1.5 million, three-year research project to examine the feasibility of short-rotation forestry delivering greater volumes of biomass from the same land area as covered by current energy crops. Capital grants have been made available to help with the installation of small-scale heat boilers, community heating networks, combined heat and power plants and large-scale, dedicated biomass electricity generating plants.

The noble Lord, Lord Teverson, asked what happens to micro-generators in the existing system. As I said in my opening speech, we take the view that FITs will be a more appropriate scheme than renewables obligation as far as concerns micro-generators. As of 1 April, micro-generators in technologies that will be supported through FITs will no longer be eligible for support through the RO scheme. Any micro-generators in these technologies already in the RO will transfer to FITs, and any new micro-generators that have commissioned since we published our proposals on 15 July 2009 will be able to join FITs from its start. The only micro-generators that will be unable to access either the RO or FITs will be those that have already been operating without any form of financial support. Allowing these generators access to FITs would not only increase the cost of the scheme, but would also not encourage additional generation, which is the primary objective of the policy. This simply does not represent value for money and we cannot justify the additional cost to consumers that the support would bring.

The noble Lord also asked about jobs. We have the offshore and service skills, and the potential to develop a lead in this sector. As I said earlier, we are now the leaders in offshore wind. There is the potential here for up to 70,000 jobs by 2020. The Carbon Trust estimates that up to two-thirds of the domestic value chain could be supplied by the UK, as well as providing significant export potential. These are high-value jobs in manufacturing, research and development, engineering, installation, O and M and services. We intend to ensure that developers and manufacturers, working with the Crown Estate, will create these jobs in the UK.

The noble Baroness, Lady Wilcox, raised the question of opening the RO to stations outside the UK. We are aware that concerns have been raised about spending United Kingdom consumers’ money on foreign investment, where the benefits stay overseas. I hope that I have summarised her point exactly. She and we are right to focus on value for money for United Kingdom consumers. However, we must also be open to the opportunities that the renewable energy directive presents, as there could be benefits to such projects. Analysis suggests that using joint projects—for example, electricity generated outside the UK—to meet a proportion of our target could offer cost savings, with a correspondingly reduced impact on United Kingdom consumer bills. This is something that we are looking into further as we take forward the work in this area. We set out in the RES that one principle according to which we will be open to projects under the flexibility mechanism will be if they offer genuine cost savings to the UK. But the responses that we received to those proposals in the RO consultation last summer raised a number of concerns that need to be addressed before any changes can be made. We need to take account of discussions at the European level on how trading would work, as well as the wider context of the issues such as grid interconnection and the route through to 2050, before any final decisions are taken, so we shall be consulting further on the matter.

Will the noble Lord deal with the question that I asked about security of supply? It is a very important matter and needs the attention of the Government. We are to rely to quite a large extent on 20,000 megawatts of wind power, both at sea and on land—incidentally, the facilities at sea will be subject to stormy weather and be difficult to maintain in winter. Therefore, if we are to maintain security of supply with advanced gas reactors, existing oil-fired power stations and certain coal-fired power stations coming offline, wind power will have to be augmented by new baseload power. The Government should be seriously considering what will happen over the next 10 years when all these power stations are taken out of service to be replaced only by wind. If we are to replace the wind power with a similar amount of conventional generating power, it will be a very costly exercise indeed.

My Lords, the noble Lord has more or less answered his own question, and I would not disagree very much with the answer he has come up with. Security of supply—keeping the lights on and keeping us warm—is of paramount importance, of course. Those of your Lordships who have attended the debates in this Room on the various aspects of the energy plan will know that that has been a central feature of our discussions and of the speeches made by my noble friend Lord Hunt of Kings Heath.

We believe that a mix of low-carbon energy, which will include nuclear power, carbon capture schemes, the opportunity to use gas and possibly investing in more facilities to import gas, along with the range of renewables that we have been discussing in the debate on the order, is the mix that we will need in future. But it is one on which we cannot be complacent and I am sure that the points made by the noble Lord today will be taken very much to heart.

That the Grand Committee do report to the House that it has considered the Apprenticeships, Skills, Children and Learning Act 2009 (Consequential Amendments) (England and Wales) Order 2010.

Relevant document: 9th Report from the Joint Committee on Statutory Instruments.

In opening the debate, I should like briefly to set out what this and the second order seek to do. The draft Local Education Authorities and Children’s Services Authorities (Integration of Functions) Order 2010 will bring primary legislation into line with current policy and practice, and thus I hope remove any scope for confusion. Since the Children Act 2004, the separate local authority departments responsible for education and for children’s social care have been integrated under a single director of children’s services. This renders the term “local education authority” obsolete in law. The order removes references to the term “local education authority” and to the term “children’s services authority”, which was introduced by the Children Act 2004. They are replaced with the single term “local authority”. This brings the terminology used in primary legislation into line with current policy and practice. I hope the Committee will agree that these changes, which have the support of the Local Government Association, are sensible.

As your Lordships will know, however, the term “local education authority” has a long history in primary legislation. In the vast majority of cases, replacing “local education authority” with “local authority” is straightforward, but in some cases this has not been possible. For example, some provisions in the Children Act 1989 would now read that “the local authority should consult the local authority”. The intention of the Act when originally passed was probably to ensure that staff in local authority education departments worked closely with their colleagues in local authority children’s social services. We have, of course, dealt with this through the Children Act 2004, which created the post of director of children’s services responsible for both. So where the effect would now be that the local authority is instructed to consult the local authority, we have repealed the relevant provision or made it clear that it applies only to consultation between different authorities.

In addition, there are several cases which refer to the functions of a local education authority. If the expression was just changed to the “functions of a local authority”, it might include everything a local authority does. To deal with this, we have introduced the concept of the “education functions of the local authority”. This mirrors the existing concept of the “social services functions of the local authority” and enables us to dispense with the term “local education authority” without changing the meaning of the original legislation. The bulk of the order deals with anomalies such as these. However, the intention is clear: to retain the original meaning by using terminology that is current and relatively accessible.

The second order that we are considering today is the Apprenticeships, Skills, Children and Learning Act 2009 (Consequential Amendments) (England and Wales) Order 2010. This order is necessary and is a technical part of the parliamentary process that was set in train by the passage of the Act in November 2009. It made provision for the replacement of the Learning and Skills Council with two new systems that will drive forward pre-19 and post-19 education and skills. These changes will take effect from 1 April 2010, and the draft consequential amendments order will provide for the further consequential amendments to primary legislation not covered by the Act.

The draft consequential amendments order repeals all remaining references to the Learning and Skills Council for England set out in primary legislation and replaces them with references to the chief executive of the Skills Funding Agency, the Young People’s Learning Agency and local authorities, whichever is the appropriate body.

As noble Lords will be aware, the 2009 Act also creates a new sixth-form college sector, providing a mechanism for existing further education corporations to be redesignated as sixth-form college corporations and allowing the establishment of new sixth-form college corporations to run institutions that cater mainly for those of sixth-form age.

The consequential amendments order will make the necessary amendments to primary legislation that are consequential to these reforms. In particular, it will amend legislation to replace references to further education corporations with references to sixth-form college corporations or sixth-form colleges, where appropriate, and ensure that existing legislation recognises the new sixth-form college sector.

Finally, the order makes technical amendments to the Childcare Act 2006. These are needed to give full effect to Section 199 of the 2009 Act, which inserted provisions into the Childcare Act about inspection of children’s centres by Ofsted. The order amends the Childcare Act so that the definitions of the terms “prescribed” and “regulations” in the Act apply to the new regulation-making powers about children’s centre inspections.

I thank the Joint Committee on Statutory Instruments and the Merits Committee for considering these draft regulations. Subject to parliamentary approval, we intend to bring this order into force at the same time as the main provisions of the 2009 Act, on 1 April 2010. We intend the integration of functions order to come into force five weeks after it is signed, at the same time as another order amending subordinate legislation. That order is a negative resolution. I commend the order to the Committee.

My Lords, I thank the Minister for introducing the orders. As its Explanatory Memorandum states, the draft Apprenticeships, Skills, Children and Learning Act 2009 (Consequential Amendments) (England and Wales) Order 2010, on which I shall focus my remarks, gives effect to the abolition of the Learning and Skills Council, as foreshadowed by the Act. The LSC was indeed a bureaucratic and inefficient organisation, but its replacement with no less than three new quangos—the YPLA, the SFA and now the NAS—does not, as we repeatedly said during the passage of the Bill, give us cause to expect a great rolling back of that bureaucracy.

We set out during the debates on the Bill how we would have preferred this to be done, and I shall not dwell on that today, save to say that our proposals would have led to a much more effective and streamlined system. However, I have questions on four areas of the order. First, the Government claimed in their impact assessments during the passage of the Bill that their proposal to replace the LSC with the new quangos would be cost-neutral. Can the Minister therefore update us with the latest estimates in that regard? Is she still confident that the measure is cost-neutral? If so, does that remain the case when the additional burden falling on local authorities under the Bill is taken into account?

Secondly, I notice in the final sentence of section 7 of the Explanatory Memorandum the statement:

“This instrument provides for amendments to primary legislation, not already covered by the Act”.

Can the Minister kindly confirm to the Committee that such changes are none the less authorised by a catch-all section in the Act allowing consequential changes or is there something more that we should know about?

Thirdly—this relates to Part 2 of Schedule 1—we are concerned to ensure that the sixth-form colleges to which the Minister referred retain their autonomy and independence, that they can specialise and achieve excellence in specific subjects and that they continue to attract people from a wider area than purely within their local authority’s area. What assurance can the Minister give me on this?

Fourthly and finally, as she said, the order also makes changes to the Childcare Act 2006 to give effect to Section 199 of the Apprenticeships, Skills, Children and Learning Act. That section expands the powers of Ofsted to allow it to inspect children’s centres. Can the Minister assure the Committee that this exercise will be properly co-ordinated and is not just another layer of bureaucracy and that Ofsted is sufficiently expert to carry out this function?

My Lords, I support these orders. They are very helpful. I am glad to follow the noble Lord, Lord De Mauley. The Government have done well to bring the orders forward in the manner in which they have been presented. I am grateful to my noble friend the Minister for her painstaking introduction. It is the case that British industry will die unless Governments of all complexions continue to smooth the progress of apprenticeships and skills. The 2009 Act concerning apprenticeships and skills is of high importance.

Ministers deserve credit for their investment in and reform of the training industry. It is clear that this investment will help to support what remains of Britain’s industries, particularly manufacturing. If our nation is to retain its standing in the industrial first rank, investment in apprenticeships and skills is of paramount importance. I acknowledge the increasingly important roles in training played by colleges of further education, sixth forms and universities. There is a massive input by our companies and enterprises, large and small, in England and Wales.

Surely, this order concerning skills and apprenticeships will make the work of the interested parties in factories, offices, colleges and universities easier and even more successful. In another place, for more than 30 years, it was my duty to follow the fortunes of the skills industry, the aerospace industry and manufacturing generally, whether in debates, by Questions or by deputations. One of the biggest manufacturing industries in the United Kingdom is the aerospace industry. It earns billions of pounds, perhaps £7 billion a year now, in exports. In the aerospace industry in England and Wales, there is great investment in apprenticeships and skills. As a result, despite global downturns, there is much skilled employment and considerable prosperity, and I pay tribute in this field of employment to the now famous European company, Airbus UK. Its large plant at Filton, Bristol, has high standing and employs several thousand highly skilled employees, and it always invests in apprenticeships and skills. The newest Airbus project, an airliner—the A350—will use composite materials for wing manufacture in this country. It will therefore require even more skills and even more apprenticeships. The workforce will move into new technological territory with the use of composites. This is now the only way forward for the aerospace industry, and our universities and colleges are in the vanguard.

The corresponding Airbus plant in north-east Wales is in Flintshire in a town called Broughton. More than 6,000 highly skilled operatives on site produce the wings of the world’s high-class airliners such as the A320, the A330, the A340—the Airbus series overall—and, not least, the world’s largest airliner, the super-jumbo A380, a double-decker machine. There are more than 600 apprentices at this plant, including school leavers, mature entrants and graduates. The plant would not prosper without investment in apprenticeships and skills. Filton and Broughton Airbus airliners are showing world-class skills. They are outselling and outproducing the great competitors, such as the mighty Boeing company, out of sight, and are earning billions of pounds per year for our country. This is because of their long-term investment as industrial sites in apprenticeships and skills. The plant at Broughton pumps £7 million per week into the economies of Chester, Cheshire, the north-west, and north-east Wales, and is one of the greatest success stories in Britain’s recent manufacturing history—indeed, since World War Two ended—and the A380, the greatest airliner that is now flying, is arguably the biggest European engineering venture since the Channel Tunnel.

Finally, and consequently, I pay tribute to the retiring senior vice-president of manufacturing, Mr Brian Fleet, CBE, who is the leader of Airbus UK. He has quite brilliantly led a wonderful team in Bristol and in north Wales that is based on apprenticeships and skills. Indeed, he was an apprentice at the Broughton plant. His rise has been remarkable, and he is renowned throughout Europe as a plane-maker, a leader of apprentices and an investor in skills and training. At Filton and Broughton, Britain has a world-class, cutting-edge, profitable and successful aerospace venture that is based on high skills.

The orders are to be welcomed. Surely, they will enhance British manufacturing via skills. Mr Fleet’s management and union teams have collaborated brilliantly to rise to every challenge in engineering, and they are helping Britain to keep her lead in employment in the aerospace industry. The apprenticeship and skills order is an England and Wales order and I would therefore appreciate a few words from the Minister concerning its impact on Wales in the knowledge that the Governments in London and Cardiff always collaborate.

My Lords, I am sure that my fellow residents of north-east Wales will be fascinated to read the comments of the noble Lord, Lord Jones, in the local newspaper.

To return to the order, I want to clarify that I intend to speak first to the apprenticeships order, which appears first on the Order Paper, although the Minister spoke to it second. It is relatively uncontroversial but, like the noble Lord, Lord De Mauley, I want to ask her about the promise that was made when the Bill, now an Act, went through Parliament, that when we moved from the LSC to the alphabet soup of the YPLA, the SFA, the NAS and the CESF—and maybe others that I have forgotten—the change would be cost-neutral and there would not be recruitment of many more staff to carry out their functions. Will the Government assure us today that they are still on track to deliver that at no increased cost?

On the local education authorities order, as the Minister said, it is mainly a matter of terminology. On a matter relating to the terminology, though, it is important that children’s services directors have the appropriate expertise in both education and children’s social services. Many local authorities have chosen to have a deputy with expertise in each of those areas, and I wonder how the Government are keeping an eye on that to ensure that local authorities have that expertise at the very top level in the line of management of the children’s services director. I am concerned that those two senior directors or deputy directors should talk to each other and have the opportunity to communicate. We cannot assume that they do, even though they may be in the same local authority building.

I am particularly concerned about children in custody in another authority and about children with disabilities who perhaps have been placed in special provision in a different authority but for whom the local authority still has responsibility. It is important that aspects of their care and education are worked on together in a cohesive way by each local authority. There is very little to say otherwise about these orders.

My Lords, I welcome the orders. I know that they cover England and Wales, but I want to mention that in my native city of Glasgow there is an excellent project taking place with the building services department—or City Building, as it is now called—where pupils as young as 14 are allowed to come from local schools into workshops and participate in pre-apprentice training. This has had a positive effect in the schools. The head teachers tell me that it has helped with discipline; when young boys or girls are behaving badly, they can be told that they are not going to go to City Building if they misbehave. They like the idea of being in a grown-up environment and learning from craftsmen and craftswomen in a way that is almost like mentoring. If they show promise, then by the time they are ready to leave school at 16, they can be offered apprenticeships as electricians, plasterers, bricklayers and carpenters. All these are trades that mean that these young people, once they become journeymen, can move easily into self-employment. Perhaps we can look at this for local authorities south of the border. It is an excellent scheme and has been very successful.

I hope we do not lose sight of the fact that many young men and women leave school and, perhaps because they did not get much guidance from their parents or because of economic circumstances, then go into unskilled jobs. As time goes on and they reach their mid-20s or even later, they regret the fact that they do not have a trade or an apprenticeship in order to learn one. These are adults who have been in other areas of work, but find that because they are unskilled, they have great difficulty finding employment. If they are willing to make the sacrifice to become adult apprentices, we should give them every encouragement. After all, if people in their 20s or 30s want to go to university, we encourage them to do that, so why do we not support them if they want to become engineers, welders or metalworkers by taking up the kind of apprenticeship that I served? However, I must say that the catering industry is very good about taking on adult apprentices, so I hope that the engineering and building industries would also be willing to do so if they were given the right encouragement by the Government.

It is a great thing that the Government are getting involved in ensuring that people can serve apprenticeships. They are an investment in young people’s futures because they will have a skill within four or five years of leaving school. They can be self-sufficient, raise a family and become a credit to the community.

I thank all noble Lords who have taken part in this short debate on the merits of these statutory instruments, and I hope that I can respond to many of the questions that have been put. I shall start by responding to the noble Lord, Lord Martin. I would like to call him “my noble friend”, but he sits on the Cross Benches in the tradition of former Speakers of the House of Commons. We listened with great interest to his comments about the experience of City Building in Glasgow, and on the importance of adult apprenticeships and the contribution they can make. We all appreciate the difficulties faced by those who leave school without the qualifications that they find they want later in life, and we need to respond to the real challenges posed by a globalised economy through promoting the improvement of skills in our workforce. It is important that we get it right for young people, but we must not leave behind adults who want to upskill. That is why my noble friend Lord Young is deeply committed to promoting apprenticeships across the age spectrum from initial training that is suitable for 14 year-olds right up to advanced apprenticeships. It might be helpful for us to write to the noble Lord setting out the Government’s work on apprenticeships and ensuring that the department is aware of the examples that he has helpfully explained to us.

My noble friend Lord Jones also shared with us his wealth of experience and perspective, particularly in manufacturing and the contribution of Airbus and the aerospace industry. Given his expertise and experience, it is very important that we take note of his contribution. I agree with him about the importance of the contribution of Airbus UK in Bristol and in Flintshire. The noble Baroness, Lady Walmsley, also has personal experience of its contribution. I was delighted to hear the noble Lord's remarks. I am sure that the senior vice-president, a former apprentice himself from Broughton, will also be interested to read his remarks.

I would say that although the detailed impact on Wales of the statutory instruments is slight, because much of education is devolved, there are minor changes that will affect Wales. For example, in the Further and Higher Education Act 1992, there will be a slight amendment in paragraphs 91 and 73 of Schedule 1. So there is an impact on Wales, but the impact of government policy—investing in skills and working with the Assembly Government—is much greater.

The noble Baroness, Lady Walmsley, and the noble Lord, Lord De Mauley, asked about the cost of the changes. I offer them the reassurance that we have seen a very clear value-for-money case in setting up the arrangements. We debated this in full when we considered the Act in Committee. As we know, there will be short-term costs in reducing the premises of the estate of the LSE, currently estimated at about £36.8 million, but they are still expected to be offset by savings in the medium term. There will also be one-off costs of £3 million to standardise the terms of transfer to local authorities, and £3 million for pensions. We have talked about all that in previous debates.

I reiterate that, over time, those changes are expected to generate net annual savings of £17 million from rationalisation of premises, IT, shared services and streamlined contracting and data collection processes. The new system is expected to be revenue-neutral for providers, with prudential savings through reduced bureaucracy.

The noble Baroness, Lady Walmsley, asked for specific assurances on the question of staff numbers. I assure her that no additional staff are being recruited, other than to fill vacancies, which we would expect, in respect of functions that are transferring from the LSE to other bodies. The noble Lord, Lord De Mauley, was very concerned that we do not create additional unnecessary administration. The Skills Funding Agency will work further to simplify systems—I know that the noble Lord is concerned about that—for example, for colleges and for training organisations, including through the single account management process and the approved college and training organisation register.

I know that we have discussed this before, but it will work co-operatively with the YPLA and local authorities to manage the interdependencies with pre-19 learning and with the Information Authority to improve data collection and dissemination through the further education data service. There is a clear focus on streamlining.

There will be a single commissioning dialogue for 14-to-19 learning. Providers currently have to engage with both the LSC and local authorities on 14-to-19 learning. In future, they will need to engage only with the lead commissioning authorities. That is a clear step forward.

The noble Lord, Lord De Mauley, also asked about authority in the 2009 Act. The consequential amendments order is authorised by Section 265 of the Apprenticeships, Skills, Children and Learning Act. The Delegated Powers Committee would have looked at those delegations to ensure that they were appropriate. That is one reason why we are having a debate on an affirmative resolution. The noble Lord, Lord De Mauley, was looking for a reiteration of the assurances that we gave in Committee on the independence of sixth-form colleges. He asked whether they would maintain their autonomy. I will reassure the noble Lord. The designation of sixth-form colleges as corporations will not change their independent status. They will remain incorporated colleges run by their college corporation, not by the local authority. They will remain responsible for all issues of staffing, premises, curriculum and finance. Local authorities will commission and fund 16-to-19 provision generally, and will performance-manage sixth-form colleges. However, noble Lords know that these sixth-form colleges are very high-performing institutions. The local authority's remit will not run beyond that performance management.

The noble Lord, Lord De Mauley, was also concerned about how Ofsted will go about inspecting children's centres. That is a matter for Ofsted. The statutory instruments are designed to ensure that the technical adjustments are made to the relevant powers so that Ofsted can make its inspections with the right regulations in place. The noble Lord is right: we want to ensure that Ofsted inspections are properly co-ordinated and that it has the appropriate expertise in place to undertake meaningful inspections. That is not something that we can achieve through legislation—Ofsted must achieve it through good management and leadership.

The noble Baroness, Lady Walmsley, asked about the importance of co-ordination between education and children's services. That issue was behind the Children Act 2004. The question is one of leadership. The job of director of children’s services is a big one, and there are many extremely successful leaders in that role. We in the department have been particularly keen to promote the leaders of the future, and, through the National College for School Leadership, to encourage and promote the leadership skills that we want to see in key roles. With the establishment of children's trust boards and a more holistic approach to looking at the delivery of child-centred services, the requirement for people in these key positions to work together becomes even more acute. As the noble Baroness suggests, it is essential that they work together, and we are doing what we need to in order to ensure that they have the skills and leadership to do that.

I thank noble Lords for taking part in this short debate. It has allowed us to look at some of the important policy issues behind the legislation. I commend this consequential and technical order to the Committee.

Motion agreed.

That the Grand Committee do report to the House that it has considered the Local Education Authorities and Children’s Services Authorities (Integration of Functions) Order 2010.

Relevant document: 9th Report from the Joint Committee on Statutory Instruments.

That the Grand Committee do report to the House that it has considered the Representation of the People (Scotland) (Amendment) Regulations 2010.

Relevant document: 7th Report from the Joint Committee on Statutory Instruments.

My Lords, I beg to move that the draft regulations laid before the House on 27 January be considered. These regulations make amendments to the Representation of the People (Scotland) Regulations 2001 and the Representation of the People (Scotland) Regulations 1986 that are necessary as a result of amendments being made to the Representation of the People Act 1983 by Section 25 of the Political Parties and Elections Act 2009. They do not therefore introduce new policy; the policy position is as provided by Parliament in the 2009 Act. These regulations simply make sure that the policy is given effect. Without these changes, Section 25 cannot be commenced.

Section 25 of the 2009 Act transfers responsibility for retaining certain United Kingdom parliamentary election documents in Scotland, thereby making them available for public inspection and disposing of them from sheriff clerks to parliamentary returning officers. Section 25 will be brought into force, by order, on the same date as these regulations.

It might be helpful if I provide some background to the introduction of Section 25 of the 2009 Act. At present, after a Westminster election has been contested in Scotland, election material, including the marked register, is sent by the returning officer to the local sheriff clerk for safekeeping. The sheriff clerk is obliged to make some of the material available for public inspection and to destroy all the material after one year, unless otherwise ordered.

However, there have been difficulties with the present arrangements for some time, as sheriff clerks do not feel that their offices are set up to carry out these functions effectively. Following consultation with stakeholders, the Government proposed a change to the law to transfer responsibility for storage and access for UK election records from sheriff clerks to returning officers. This is already the position for documents relating to European Parliament and local government elections in Scotland. It also essentially mirrors the practice in England and Wales where local authorities, through electoral registration officers who are also acting returning officers, are responsible for these functions.

Similar provision will be made for Scottish Parliament election material through the Scottish Parliament (Elections etc.) Order, which will be made before the 2011 Scottish parliamentary elections.

On timing, the intention is for the new arrangements to apply to the next general election. This is of course subject to Parliament approving these regulations and the regulations being made sufficiently in advance of the date of the poll.

As for consultation, the Society of Local Authority Chief Executives, which represents returning officers in Scotland, and the Electoral Commission were consulted on the proposal to transfer these functions from sheriff clerks to returning officers and on the proposed commencement date. They were content. In addition, and in line with statutory requirements, the Electoral Commission was consulted on the draft regulations.

On the question of funding, returning officers will be able to claim for the costs necessarily incurred in connection with their new functions as part of their claim under Section 29 of the 1983 Act. Section 29 provides for payments to and by returning officers. In addition, fees will be payable to returning officers by eligible purchasers of the marked register of electors and the marked postal vote list for UK parliamentary elections in Scotland. These regulations do not change the existing fees, which remain as set out in the Representation of the People (Scotland) Regulations 2001.

To summarise, these regulations do not introduce new policy; they simply make consequential changes that are necessary as a result of Section 25 of the Political Parties and Elections Act 2009, which transfers functions in relation to retention, public inspection and disposal of parliamentary election documents in Scotland from sheriff clerks to parliamentary returning officers. I commend the regulations to the Committee. I beg to move.

My Lords, I thank the Minister for explaining these regulations in some detail. They are a bit opaque when you see what is printed on the page.

I was going to ask whether the returning officers are likely to have offices suitable for the receipt of this material, and I was a bit surprised to hear the Minister say that the sheriff’s officers did not feel that they had adequate provision. I suppose that I should be slightly reassured by the fact that he says that the returning officers already keep similar material for the European and local elections. I hope that provision is being made for them to be able to store this additional material. I do not know how much security is required for storing such items. If they are all equally subject to the same regulation that states that they can be destroyed after one year, that simplifies the amount of storage that is required.

I am interested to see that this measure includes an element of modification to the Representation of the People (Scotland) Regulations 1986, practically all of which, as far as I can understand, were abolished by the regulations in 2001. This must just be the fag-end of those earlier regulations. Given that this appears to be mainly a tidying-up exercise, we are pleased to support the regulations.

I also thank the Minister for his clear explanation of the regulations. They seem to be uncontroversial, and it is to be hoped that the Government will be able to expedite their enactment so that they indeed come into effect before the general election.

In so far as they have any purpose, it appears that it is to simplify the arrangements for holding papers. So far as I can understand, there is no substantive change in the nature of the papers that will be retained by the returning officers and those that are held by sheriff clerks. It was stated, when the regulations were introduced in another place, that there had been difficulties with access and with the fees to be charged. I am not clear why there were difficulties, but it is important to be reassured that those difficulties have been addressed and in particular that the fees regulations to which the Minister referred are not intended to do more than cover reasonable costs. Local authorities are under considerable pressure, and one would not wish the public's free access to matters connected with elections, to which they would otherwise be entitled, to be in any way restrained by action that might be taken to raise funds from such matters. I assume that these things are handled by relatively few people and that the costs will be minimal. I hope to be reassured on that point.

My Lords, I came here earlier to talk about apprenticeships. By coincidence, I see a piece of Scottish business before us. I am of course interested in the matter. I sat in the other place for 30 years. By virtue of that, I was a parliamentary candidate for many years, and in local government before that. Perhaps I may ask the Minister which sheriff clerks have been complaining, because I have not heard any complaints. The system seemed to work for the 30 years that I was an elected Member of the other House. Perhaps the Minister could tell us which sheriffs have said that this is too tough for them. No one seemed to complain in the past.

We must be careful not to put an extra burden on local government. It is not only the financial side of things; office space is at a premium in most local government buildings because of worthwhile legislation concerning health and safety. The workforce must have proper space, and there must always be proper access to a building. Taking on this extra job will in some cases put a strain on local authority buildings, because a facility will have to be found so that visitors, including disabled visitors, will be able to get access. It will involve extra accommodation.

I recall the Scottish Government elections two years ago. Both Houses had agreed on an electronic system. That put a terrible strain on local government. When it came to the counts, there was great difficulty getting the results. If it had been done manually, we would have got the results, albeit at 3 am or 4 am. In the local authority where I live, the postal votes were not ready. Because I knew my way around the local government buildings, I was able to say, “Look, you must get my postal vote to me before Saturday or else I will not be able to exercise my right to vote”. This is an indication of the terrible strain on local government. If the regulations are to be implemented for the next general election, which is only weeks away, it will be more of a strain, because things that are done in a rush can cause difficulties. Who is doing the complaining? If we are passing orders through this House, we should know where the complaints are coming from.

The geography of Scotland is very different from that of other parts of the country. In the city of Glasgow, to which I am so used, it is easy to get to the sheriff’s building, but if you live in the constituency of Argyll, getting from Campbeltown to Inveraray or to Oban is a full day’s journey. The constituency represented by the noble Lord sitting opposite me up in the Highlands is certainly not one where it is a 15-minute journey to get to these buildings. The long distances involved in some of these constituencies will put an extra strain on local government because people have become used to the sheriff’s building having these facilities. In an island community, different islands may now hold the information.

I thank noble Lords for their observations about this statutory instrument, which I shall deal with in order. First, I shall address the points raised by the noble Duke, the Duke of Montrose, concerning whether there will be enough space in the offices of returning officers for storage of the additional material. I can confirm that matters will remain as they are: namely, that destruction will take place after one year, and therefore it is unlikely that there will be a massive addition to the documentation that will be retained. I respectfully agree with him that the purpose of this instrument is to tidy up these matters substantially, primarily by moving from the sheriff clerks’ offices to those of returning officers.

The noble Lord, Lord Maclennan, encouraged me to ensure that matters in relation to this instrument are expedited. I can confirm that it will come into force, together with the relative provision in the 2009 Act, when the instrument is made. I understand that that is likely to take place either this coming Wednesday or next Monday, after which two further days must elapse. I trust that that gives him some confidence that expedition will be to the fore.

In relation to matters that may have been mentioned in another place regarding difficulties of access, I am unaware of what that might actually relate to. On fees, no changes are proposed. The approach that has been taken is that of trying to recover reasonable costs and is the same guidance that will obtain pursuant to this instrument. If the noble Lord wishes for clarification, I can confirm that this will not be directed as some sort of fundraising exercise.

The noble Lord, Lord Martin, wanted to know which sheriff clerks were particularly tried by the current arrangements. I am afraid that I cannot give names and numbers, but I assure him that there have been difficulties with the present arrangements and that this is a widespread view held in sheriff clerks’ offices, which are normally set up to deal with the business of the sheriff clerk. They are not confident that they are able to deal with these particular functions. The noble Lord may remember the problem that rose following the Glenrothes by-election when the marked register went missing. Issues such as that have raised a real problem.

We hope that this will not be a strain on local authorities. Consultation is taking place with the Electoral Commission, the electoral authorities and, of course, the political parties. No particular perceived strain has been identified. There is continual monitoring of what goes on with the electoral authorities and, if such a strain were to emerge, further fine-tuning may be brought to bear. I entirely share the noble Lord’s concern that the geography of Scotland can put considerable burdens on people in terms of travelling, but these problems are pretty much the same for the sheriff courts, which are similarly distributed throughout fair Caledonia. In any event, returning officers’ offices have already had to deal with local authority elections and European elections, so it is unlikely that geography will create a particular problem. I hope that deals with the issues that have been raised by noble Lords.

Motion agreed.

That the Grand Committee do report to the House that it has considered the Criminal Defence Service (Information Requests) (Amendment) Regulations 2010.

Relevant document: 8th Report from the Joint Committee on Statutory Instruments.

My Lords, in moving that the Committee consider the draft regulations, I shall speak also to the draft Criminal Defence Service (Representation Orders: Appeals etc.) (Amendment) Regulations 2010. These two sets of regulations are made by the Lord Chancellor under the Access to Justice Act 1999 and are subject to the affirmative resolution procedure under Section 25(9) of that Act. I hope not to detain the Committee too long in its consideration of these draft regulations. They are both about legal aid in criminal cases, but their substance is unrelated.

The draft Criminal Defence Service (Information Requests) (Amendment) Regulations are the final piece in the jigsaw of regulations required to support the introduction of means-testing in the Crown Court, which began on 11 January this year. They mirror regulations currently in force in relation to magistrates’ court means-testing. As your Lordships know, that scheme has been in operation since October 2006 and the current regulations have supported magistrates’ court means-testing for over a year.

These draft amendment regulations provide for the range and accuracy of a defendant’s application for legal aid in the Crown Court to be checked by the assessing authority. They will play a key part in providing a level of assurance about the validity of claims, ensuring that steps can be taken to protect the Legal Aid Fund from fraudulent applications and, equally importantly, making sure that a defendant’s liability to make a contribution to their defence costs is calculated accurately. They will enable court staff, on behalf of the Legal Services Commission, to seek information from Her Majesty’s Revenue and Customs and the Department for Work and Pensions about a defendant’s income and capital. The powers necessary for this process were inserted in the Access to Justice Act by the Coroners and Justice Act 2009. The Committee may recall the debates we had in this place in Committee and on Report about these provisions.

The draft Criminal Defence Service (Representation Orders: Appeals etc.) (Amendment) Regulations are a small but none the less important step in ensuring that defendants in the magistrates’ court—these regulations deal with the magistrates’ court only—who are aggrieved by a refusal of a representation order on interests-of- justice grounds have an enhanced right of appeal against such a refusal. The interests-of-justice test takes into account a range of factors, including whether, in the event of a conviction, the defendant faces a loss of liberty or livelihood and whether the defendant is able to understand the proceedings and take an active part in court. The Government understand that there will be situations in which an initial refusal of a representation order is subsequently found to be incorrect, such as when a defendant provides further information to strengthen their application. In order to preserve the element of judicial scrutiny that is vital in deciding an interests-of-justice test, the new draft regulations provide that a refusal to grant a representation order on interests-of-justice grounds can be reviewed in the first instance by a member of the magistrates’ court staff, with a further appeal to the court in the event that the initial refusal is upheld.

It might be helpful if I pause briefly to explain that a second bite of the cherry used to be available to a defendant. When responsibility for granting representation orders was transferred from the courts to the Legal Services Commission, my department provided for appeals against a refusal to grant a representation order to be heard in all instances by the court. This was done in response to comments that the Government took on board during the passage of what became the Criminal Defence Service Act 2006. These draft regulations restore the position of a defendant to the position that obtained prior to the enactment of that legislation. Not only do the regulations enhance the appeal process that is available to a defendant, but equally importantly they free up the time of the courts to concentrate on the efficient and timely disposal of cases. I hope that the Committee will consider this a positive move.

In our view, these two sets of draft regulations are a necessary and important step in developing robust support for the work of the magistrates’ courts and Crown Courts, and I commend them to the Committee.

My Lords, I am grateful to the noble Lord for bringing these two sets of regulations to the Committee and for his explanation. Like him, I hope that I will not detain the Committee for long in examining what he describes as the final piece in the jigsaw. If it was possible for the whole jigsaw to be put in front of us at once on some occasions, life might be considerably easier.

The answer to my first question is presumably very simple, but I genuinely do not know it. The Explanatory Memorandum for the Criminal Defence Service (Information Requests) (Amendment) Regulations 2010 also deals with two other orders, which I take to be negative instruments and the reason why they are not before the House. I would be most grateful if the Minister could confirm that. Secondly, the Minister quite rightly stressed that it was important to be able to have these regulations for the very good reason that it is important to be able to protect the Legal Aid Fund against fraud. Will he tell us his department’s estimates of the levels of fraud in legal aid funding? Is it even possible to make such estimates or are they guesstimates? I remember from my days in social security the great difficulty in ever estimating how much fraud there was, because by its very nature one did not know, but I presume that the department has made some estimates and I should be grateful for advice on that.

My final and very minor question relates to the appeals regulations. As the Minister made clear, where the representation authority refuses an application, the individual may appeal first to the staff of the magistrates’ courts and then to the court, but I take it that, even if the court turns that down, it would on certain occasions be possible to appeal beyond the court. I should be grateful for advice from the Minister as to whether that is the case. Having said that, it is not necessary to go back to the debates on the substantive legislation; we all remember those. For the moment, we are dealing merely with the regulations. I have no further questions.

My Lords, I declare an interest because I am in receipt of legal aid fees. The noble Lord, Lord Henley, referred to a jigsaw. What has happened is that the pieces of the jigsaw have all been broken up and thrown into the air; or, to use another metaphor, the architecture of legal aid has completely changed in the decisions announced last week, whereby the Legal Services Commission has been abolished. As I understand it, it was the representation authority which originally granted legal aid, subject to appeals. What is to replace it? The Minister was quoted last week as saying that decisions on the grounds of legal aid will remain completely independent and Ministers will not have any part in them. He also said;

“I want to make it very clear that we consider it essential that there is a clear separation between ministers and funding decisions in individual cases”.

Will he take this opportunity to explain what is now meant by the representation authority? Are we moving away from the Legal Services Commission to some unformed executive agency that is in some way up in the air? When will the legal aid package be put together as a whole?

Bringing these regulations forward at the moment is jumping the gun, because until we can see the whole picture and what the representation authority referred to in these regulations is, we are at something of a loss. I said last year all that I want to say on the principle, when we debated it first in February and later in November. I shall not repeat my objection in principle to the way in which the Government have gone about reintroducing means tests and so on. The noble Lord knows where I stand on that, but I ask him: is this not premature? Should we not wait at least to find out what executive agency is proposed and how there will be a clear separation between Ministers and funding decisions?

The director of the Legal Action Group, described this change as,

“a complete politicisation of legal administration”.

These announcements have been made, and there has been a very fetching picture of the Minister in some newspapers. He is not running in the election, so perhaps “politicisation” is taking it a bit far. However, clearly there has been a very important change due to the manifest deficiencies of the Legal Services Commission, which tried and failed over many years to bring some sense to the situation and was heavily criticised last week by the Lord Chancellor, Mr Jack Straw.

Those are my questions and I look forward to hearing the answers.

I am grateful to both noble Lords, who have approached these regulations in slightly different but extremely helpful ways.

I shall answer the noble Lord, Lord Henley, as best I can. Yes, it would be great to have the jigsaw in place on one occasion. It has not happened here, but there are good reasons for that. He is right to say that the two statutory instruments he referred to are negative. He asked about fraud in relation to the first statutory instrument. I cannot help him very much. It is not possible to make an accurate estimate, given that more than 1.6 million acts of assistance are provided, but these regulations are of course designed to make the process transparent for defendants and the fund. As Minister responsible for legal aid, I often receive letters from Members of Parliament if one of their constituents has said to them, often in matrimonial cases, “Look, the person on the other side should not be legally aided. Why aren’t I?”. There are ways of looking into such matters, which involve closer working with the DWP than was previously possible. The noble Lord also asked about the second instrument. If the first appeal was to the staff and the second to the court, he asked, was there a further appeal? Only by way of judicial review, but it does exist.

The noble Lord, Lord Thomas of Gresford, referred to the recent decisions made about the Legal Services Commission. For the time being, the commission remains a non-governmental public body. Primary legislation will be needed for it to change its status to that of executive agency. We hope to legislate on that matter, literally as soon as possible, but for now the commission, under a new chief executive, carries on with the functions that it has in law under the Access to Justice Act 1999.

The regulations are before the House today so that the Crown Court means-testing policy, which has already begun in some adopter areas—I have visited Preston Crown Court, for example, where this has already been introduced, and cases are beginning to come through from the magistrates’ courts—can be started. Whether or not it will be a success we do not know yet; the jury is out. I remember well the noble Lord’s concerns about that matter. We will have to see.

The burden of what the noble Lord had to say, though, was to get me to try to answer the “independence” criticism that has been made. The decision eventually to abolish the Legal Services Commission as it is and move it to an executive agency has been widely supported by the Bar, the Law Society and many commentators. We counter the argument about independence that he refers to by saying that the last thing that Ministers would do under the new system is decide individual cases on legal aid; that would be quite wrong. How will we stop individual Ministers doing that? As I understand it, the Bill is being drafted to change the status of the body by including a clause that makes clear the position—that it will not be for Ministers to make decisions on individual cases—although I cannot guarantee that that will be in the Bill. The other way that it is done by the DWP at present is to ensure that there is an independent body to appeal to on a decision so that it cannot be said that the department, let alone a Minister, has the final word on an individual decision on legal aid.

Bearing in mind that legal aid is frequently granted for the purposes of suing the Government themselves and individual Ministers, I can understand the Minister saying that Ministers will be prevented from decision-making, but will they be prevented from making representations to whatever authority or executive agency is involved in making decision to grant legal aid? As the executive agency will be an instrument of government, representations from a Minister will carry a lot of weight with that executive agency, and therein lies the possibility of real conflict.

That is an important point. Ministers should keep out of representing their own views on individual decisions. They are entitled to set down policy lines that may or may not be adopted by Parliament with regard to what class of person should be granted legal aid and in what kind of case, but Ministers should keep well away from making individual decisions, or even recommendations on individual decisions. This will be an important point, but one that, if I may say so, has been exaggerated. I do not think that there is any danger that the independence of decision-making about individual legal aid will not be maintained. It is important—I say so in Parliament, as it were—that that should be the case, and that is our determination.

It is important, too, that in appropriate cases, those who want to bring actions against the state—whether against local or national government—should be able to do so. In many ways, that is the mark of a free society. We want to guarantee that the independence that the noble Lord asked me about is maintained. The answer to his first question is that it will take some time for the agency to come into being. It will need an Act of Parliament for that to happen. For that reason, we have come forward today with these regulations.

That the Grand Committee do report to the House that it has considered the Criminal Defence Service (Representation Orders: Appeals etc.) (Amendment) Regulations 2010.

Relevant document: 9th Report from the Joint Committee on Statutory Instruments.